AMENDED AND RESTATED
CREDIT AGREEMENT
(7-YEAR CONVERTIBLE TERM REVOLVING LOAN)
(10-YEAR CONVERTIBLE TERM REVOLVING LOAN)
BY AND BETWEEN
COBANK, ACB,
AS LEAD ARRANGER AND BOOK MANAGER, AND AS ADMINISTRATIVE, DOCUMENTATION AND
COLLATERAL AGENT, AND AS A SYNDICATION PARTY;
Farm Credit Services of America, FLCA
AS CO-ARRANGER AND AS A SYNDICATION PARTY; AND
CREDIT AGRICOLE INDOSUEZ, XXXXXX TRUST AND
SAVINGS BANK, SUNTRUST BANK, AND U.S. BANCORP AG CREDIT, INC., DEERE
CREDIT, INC., FIRSTAR BANK, N.A., AND BANK OF TEXAS
AS SYNDICATION PARTIES,
AND
PILGRIM'S PRIDE CORPORATION, AS BORROWER
DATED AS OF NOVEMBER 16, 2000
1
AMENDED AND RESTATED
CREDIT AGREEMENT
(7-YEAR CONVERTIBLE TERM REVOLVING LOAN)
(10-YEAR CONVERTIBLE TERM REVOLVING LOAN)
RECITALS
A. COBANK, ACB as the Administrative, Documentation, and Collateral
Agent for the benefit of the present and future Syndication Parties, Lead
Arranger and Book Manager, and as a Syndication Party, FARM CREDIT SERVICES
OF AMERICA, FLCA, as Co-Arranger and as a Syndication Party, the
Syndication Parties identified on Schedule 1 thereto, and PILGRIM'S PRIDE
CORPORATION, a corporation formed under the laws of the State of Delaware,
entered into that certain Credit Agreement ("1999 CREDIT AGREEMENT") dated
as of December 14, 1999 ("ORIGINAL EFFECTIVE DATE").
B. The parties to the 1999 Credit Agreement desire to make certain
amendments to, but not to discharge any indebtedness or other obligations
owing under, the 1999 Credit Agreement, as incorporated in this Amended and
Restated Credit Agreement.
AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT ("CREDIT AGREEMENT") is
entered into as of the 16th day of November 2000 ("EFFECTIVE DATE"), by and
between COBANK, ACB ("COBANK") as the Administrative, Documentation, and
Collateral Agent for the benefit of the present and future Syndication
Parties (in its capacity as Administrative Agent and Collateral Agent, the
"ADMINISTRATIVE AGENT"), Lead Arranger and Book Manager, and as a
Syndication Party, FARM CREDIT SERVICES OF AMERICA, FLCA, as Co-Arranger
("FCSA") and as a Syndication Party, the Syndication Parties identified on
SCHEDULE 1 hereto, and PILGRIM'S PRIDE CORPORATION, a corporation formed
under the laws of the State of Delaware, whose address is 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxx, Xxxxx 00000 ("BORROWER"), and amends, restates, and
replaces in its entirety the 1999 Credit Agreement effective as of the
Effective Date.
Article 1. DEFINED TERMS
As used in this Credit Agreement, the following terms shall have the
meanings set forth below (and such meaning shall be equally applicable to
both the singular and plural form of the terms defined, as the context may
require):
1.1 ACQUISITION AGREEMENT: the document entitled "Agreement and Plan
of Merger" among Borrower, WLR and Acquisition Corp. and dated as of
September 27, 2000.
1.2 ACQUISITION CORP.: means PPC Acquisition Corp., a Virginia
corporation, a newly formed direct, wholly owned Subsidiary of Borrower.
1.3 ADMINISTRATIVE AGENT OFFICE: shall mean the address set forth at
Subsection 15.4.2 hereof, as it may change from time to time by notice to
all parties to this Credit Agreement.
1.4 ADVANCE: an advance of funds under either the 7 Year Revolving
Loan or the 10 Year Revolving Loan.
1.5 ADVANCE DATE: a day (which shall be a Banking Day) on which an
Advance is made.
1.6 AGGREGATE COMMITMENT: collectively the Aggregate 7 Year
Commitment and the Aggregate 10 Year Commitment.
1.7 AGGREGATE 7 YEAR COMMITMENT: shall be $115,000,000.00, subject to
reduction as provided in Section 2.8 hereof.
1.8 AGGREGATE 10 YEAR COMMITMENT: shall be $285,000,000.00, subject
to reduction as provided in Section 3.8 hereof.
1.9 AMENDMENT DOCUMENTS: this Credit Agreement, each amendment to
security agreement, each amendment to deed of trust, the amendment to
guaranty, and any other documents executed on or as of the Effective Date
in connection with this Credit Agreement.
1.10 APPLICABLE LENDING OFFICE: means, for each Syndication Party and
for each type of Advance, the lending office of such Syndication Party
designated as such for such type of Advance on its signature page hereof or
in the applicable Syndication Acquisition Agreement or such other office of
such Syndication Party as such Syndication Party may from time to time
specify to the Administrative Agent and Borrower as the office by which its
Advances of such type are to be made and maintained.
1.11 APPLICABLE MARGIN: means the 7 Year LIBOR Margin, the 7 Year
Base Rate Margin, the 10 Year LIBOR Margin, or the 10 Year Base Rate
Margin, as applicable.
1.12 APPRAISAL: A written appraisal report by an ARA or MAI certified
appraiser with a General Certification from the State in which the property
being appraised is located, which report provides the appraiser's opinion
as to the market value of the property being appraised on the basis of
(a) comparable sales and (b) replacement cost.
1.13 APPRAISED VALUE: the value of an asset included within the
Collateral determined on the basis of the fair market value as set forth in
the most recent Appraisal.
1.14 AVAILABILITY PERIOD: shall mean the period from the Closing Date
until the Banking Day immediately prior to the fourth anniversary of the
Closing Date.
1.15 AVAILABLE AMOUNT: the lesser of (a) $400,000,000.00 and
(b) seventy-five percent (75%) of the Appraised Value (as shown on the
latest Available Amount Report pursuant to the latest Appraisal as provided
pursuant to the 1999 Credit Agreement or this Credit Agreement, whichever
is later) of the Collateral in which the Syndication Parties have a
perfected first priority lien (without considering the lien which secures,
but after deducting from the Appraised Value the amount owing under, any
Pari Passu Loan); provided however that on and after the Merger
Consummation Date: (i) the WLR Chicken Assets shall be valued at
$135,000,000.00 without an Appraisal and notwithstanding that the
Syndication Parties do not have a perfected first priority lien thereon
(provided that the Syndication Parties do have a first priority lien on the
Acquisition Stock and, prior to consummation of the Subsidiary Merger, on
the Xxxxxxx Securities Collateral) until not later than the date which is
182 days after the Merger Consummation Date, after which date such assets
shall not be included in the Available Amount unless and except to the
extent that (A) the Syndication Parties have a perfected first priority
lien (without considering the lien which secures, but after deducting from
the Appraised Value the amount owing under, any Pari Passu Loan) on such
assets, (B) the Administrative Agent has received, in satisfactory form,
all required Phase I reports (and, if reasonably required by the
Administrative Agent, Phase II reports), title insurance, and surveys on
such assets, and (C) the Administrative Agent has received an Available
Amount Report supported by an acceptable Appraisal with respect to such
assets; and (ii) the WLR Turkey Assets shall be valued at $65,000,000.00
without an Appraisal and notwithstanding that the Syndication Parties do
not have a perfected first priority lien thereon until not later than the
date which is 548 days after the Merger Consummation Date, after which date
such assets shall not be included in the Available Amount unless and except
to the extent that (A) the Syndication Parties have a perfected first
priority lien (without considering the lien which secures, but after
deducting from the Appraised Value the amount owing under, any Pari Passu
Loan) on such assets, (B) the Administrative Agent has received, in
satisfactory form, all required Phase I reports (and, if reasonably
required by the Administrative Agent, Phase II reports), title insurance,
and surveys on such assets, and (C) the Administrative Agent has received
an Available Amount Report supported by an acceptable Appraisal with
respect to such assets.
1.16 BANK DEBT: all amounts owing under or on account of the Notes,
Funding Losses and all interest, fees, expenses, charges and other amounts
payable by Borrower pursuant to the Loan Documents.
1.17 BANKING DAY: any day (a) other than a Saturday or Sunday and
other than a day which is a Federal legal holiday or a legal holiday for
banks in the States of Colorado or New York, and (b) if such day relates to
a borrowing of, a payment or prepayment of principal of or interest on, a
continuation of or conversion into, or a LIBO Rate Period for, a LIBO Rate
Loan, or a notice by Borrower with respect to any such borrowing, payment,
prepayment, continuation, conversion, or LIBO Rate Period, on which
dealings in U.S. Dollar deposits are carried out in the London interbank
market.
1.18 BASE RATE: a rate of interest per annum equal to the "prime
rate" as published from time to time in the Eastern Edition of the Wall
Street Journal as the average prime lending rate for seventy-five percent
(75%) of the United States' thirty (30) largest commercial banks, or if the
Wall Street Journal shall cease publication or cease publishing the "prime
rate" on a regular basis, such other regularly published average prime rate
applicable to such commercial banks as is acceptable to the Administrative
Agent in its reasonable discretion, with such rate modified by adding the 7
Year Base Rate Margin or the 10 Year Base Rate Margin, depending on whether
the Base Rate Loan is being made under the 7 Year Revolving Loan or the 10
Year Revolving Loan, respectively.
1.19 BORROWER'S ACCOUNT: means Borrower's account # 0000000 at Xxxxxx
Trust and Savings Bank (ABA #000000000).
1.20 BORROWER BENEFIT PLAN: means (a) any funded "employee welfare
benefit plan," as that term is defined in Section 3(1) of ERISA; (b) any
"multiemployer plans," as defined in Section 3(37) of ERISA; (c) any
"employee pension benefit plan" as defined in Section 3(2) of ERISA;
(d) any "employee benefit plan", as such term is defined in Section 3(3) of
ERISA; (e) any "multiple employer plan" within the meaning of Section 413
of the Code; (f) any "multiple employer welfare arrangement" within the
meaning of Section 3(40) of ERISA; (g) a "voluntary employees' beneficiary
association" within the meaning of Section 501(c)(9) of the Code; (h) a
"welfare benefit fund" within the meaning of Section 419 of the Code; or
(i) any employee welfare benefit plan within the meaning of Section 3(1) of
ERISA for the benefit of retired or former employees, which is maintained
by the Borrower or in which Borrower participates or to which Borrower is
obligated to contribute, but excluding any such plan, arrangement,
association or fund that is maintained outside of the United States
primarily for the benefit of persons substantially all of whom are
nonresident aliens.
1.21 BORROWER'S PLEDGE AGREEMENT: means the Security and Stock Pledge
Agreement in form and substance satisfactory to the Administrative Agent
whereby Borrower, to secure its obligations hereunder and under the other
Loan Documents, grants to the Administrative Agent, for the benefit of all
present and future Syndication Parties, a first lien security interest in
all of its Acquisition Stock and all rights with respect thereto, including
the right to receive distributions.
1.22 CAPITAL LEASE: means any lease of property (whether real,
personal or mixed) by a Person, the discounted present value of the rental
obligations of such Person as lessee under such lease, in accordance with
GAAP, is required to be capitalized on the balance sheet of such Person.
1.23 CAPITAL LEASE OBLIGATION: the discounted present value of the
rental obligation, under a Capital Lease.
1.24 CASUALTY EVENT: means a loss or taking caused by or resulting
from a fire, earthquake, explosion, wind, rain, or condemnation, or
substantially similar occurrence.
1.25 CASUALTY PROCEEDS: the amount received on account of a Casualty
Event from insurance, condemnation award, judgment, or settlement.
1.26 CLOSING DATE: that date on which the Administrative Agent, the
Syndication Parties, and Borrower have executed all Loan Documents to which
they are parties and on which the conditions set forth in Section 9.1 of
this Credit Agreement have been met.
1.27 CODE: means the Internal Revenue Code of 1986, as amended from
time to time.
1.28 COLLATERAL: means the Borrower Collateral and the Xxxxxxx
Collateral collectively.
1.29 COMERICA LOAN: that loan in the current principal amount of not
more than $30,000,000.00 to Pilgrim's Pride S.A. de C.V. from Comerica
Bank, pursuant to that certain Revolving Credit Agreement dated as of March
9, 1998, as it may be amended from time to time, and including any loan to
refinance the principal owing under such loan so long as the amount of such
refinance loan does not exceed $30,000,000.00 principal.
1.30 COMMITTED 10 YEAR ADVANCES: the principal amount of all 10 Year
Advances which any Syndication Party is obligated to make as a result of
Borrower having presented a Borrowing Notice to the Administrative Agent as
provided in Section 3.6 hereof, but which has not been funded.
1.31 COMMITTED 7 YEAR ADVANCES: the principal amount of all 7 Year
Advances which any Syndication Party is obligated to make as a result of
Borrower having presented a Borrowing Notice to the Administrative Agent
pursuant to Section 2.6 hereof, but which has not been funded.
1.32 COMPLIANCE CERTIFICATE: a certificate of the chief financial
officer of Borrower in the form attached hereto as EXHIBIT 1.32 and
otherwise reasonably acceptable to the Administrative Agent.
1.33 CONSOLIDATED CURRENT ASSETS: the total current assets of
Borrower and its Subsidiaries as measured in accordance with GAAP.
1.34 CONSOLIDATED CURRENT LIABILITIES: the total current liabilities
of Borrower and its Subsidiaries as measured in accordance with GAAP.
1.35 CONSOLIDATED INTEREST EXPENSE: all interest expense of Borrower
and its Consolidated Subsidiaries, as determined in accordance with GAAP.
1.36 CONSOLIDATED NET INCOME: the net income of Borrower and all its
Consolidated Subsidiaries, determined on a consolidated basis in accordance
with GAAP.
1.37 CONSOLIDATED SUBSIDIARY: any Subsidiary whose accounts are
consolidated with those of Borrower in accordance with GAAP.
1.38 CONVERTED LOANS: collectively the Converted 7 Year Loans and the
Converted 10 Year Loans.
1.39 CURRENT ASSETS: the current amount of assets of a Person which
in accordance with GAAP may be properly classified as current assets after
deducting adequate reserves where proper.
1.40 CURRENT LIABILITIES: all items (including taxes accrued as
estimated) which in accordance with GAAP may be properly classified as
current liabilities, and including in any event all amounts outstanding
from time to time.
1.41 CURRENT RATIO: the ratio of Current Assets to Current
Liabilities of Borrower and its Consolidated Subsidiaries.
1.42 DEBT: means as to any Person, without duplication:
(a) indebtedness, obligations, or liability of such Person for borrowed
money (including by the issuance of debt securities), or for the deferred
purchase price of property or services (excluding trade obligations);
(b) the aggregate of the principal components of all Capital Leases and
other agreements for the use, acquisition or retention of real or personal
property which are required to be capitalized under GAAP; (c) to the extent
drawn upon, obligations of such Person arising under bankers' or trade
acceptance facilities, letters of credit, customer advances and other
extensions of credit whether or not representing obligations for borrowed
money; (d) all guarantees, endorsements and other contingent obligations of
such Person with respect to indebtedness arising from money borrowed by
others (with the exception of guarantees of trade payables of Pilgrim's
Pride S.A. de C.V., a Mexican corporation and a wholly owned subsidiary of
Borrower within the limits allowed under Section 11.5 hereof); (e) all
obligations secured by a lien on property owned by such Person, whether or
not the obligations have been assumed; and (f) all obligations of such
Person under any agreement providing for an interest rate swap, cap, cap
and floor, contingent participation or other hedging mechanisms with
respect to interest payable on any of the items described in this
definition; provided that, notwithstanding the foregoing, the term "Debt"
shall not include the amount of indebtedness outstanding under the 10 7/8%
Notes so long as the trustee for the 10 7/8% Notes shall hold cash in an
amount sufficient to repay the 10 7/8% Notes in full and so long as such
cash is treated as restricted cash.
1.43 DEFAULT INTEREST RATE: a rate of interest equal to 200 basis
points in excess of the Base Rate which would otherwise be applicable on
the Facilities.
1.44 DEPRECIATION: the total depreciation of Borrower and its
Consolidated Subsidiaries as measured in accordance with GAAP.
1.45 EBITDA: for any period, for Borrower and its Consolidated
Subsidiaries, net income for such period, plus the sum of the amounts of
(a) Interest Expense, plus (b) federal and state income taxes, plus
(c) depreciation and amortization expenses, plus (d) extraordinary losses,
minus (e) extraordinary gains, in each case as charged against (or added
to, as the case may be) revenues to arrive at net income for such period,
all as determined by GAAP.
1.46 ENVIRONMENTAL LAWS: any federal, state, or local law, statute,
ordinance, rule, regulation, administration order, or permit now in effect
or hereinafter enacted, pertaining to the public health, safety, industrial
hygiene, or the environmental conditions on, under or about the Collateral,
including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 as amended, 42 U.S.C. 9601-9657
("CERCLA") and the Resource Conservation and Recovery Act of 1976, 42
U.S.C. 6901-6987 ("RCRA").
1.47 ERISA: the Employee Retirement Income Security Act of 1974, as
amended, and the regulations thereunder.
1.48 ERISA AFFILIATE: means any corporation or trade or business
which is a member of the same controlled group of corporations (within the
meaning of Section 414(b) of the Code) as Borrower or is under common
control (within the meaning of Section 414(c) of the Code) with Borrower,
provided, however, that for purposes of provisions herein concerning
minimum funding obligations (imposed under Section 412 of the Code or
Section 302 of ERISA), the term "ERISA Affiliate" shall also include any
entity required to be aggregated with Borrower under Section 414(m) or
414(o) of the Code.
1.49 FACILITIES: shall be a collective reference to the 7 Year
Revolving Loan and the 10 Year Revolving Loan.
1.50 FINANCIAL PROJECTIONS: Financial projections of the operations
of Borrower and its Subsidiaries as attached to the Confidential
Information Memorandum dated October 2000.
1.51 FISCAL QUARTER: each of the four (4) quarter accounting periods
of thirteen (13) or fourteen (14) weeks of Borrower that together comprise
a Fiscal Year.
1.52 FISCAL YEAR: the 52 or 53 week period (a) ending on the Saturday
closest to September 30 in each calendar year, regardless of whether such
Saturday occurs in September or October of any calendar year and
(b) beginning on the day immediately following the end of the preceding
Fiscal Year.
1.53 FIXED CHARGE COVERAGE RATIO: the ratio of (a) the sum of EBITDA
and all amounts payable under all non-cancelable Operating Leases
(determined on a consolidated basis in accordance with GAAP) for the period
in question, to (b) the sum of (without duplication) (i) Interest Expense
for such period, (ii) the sum of the scheduled current maturities
(determined on a consolidated basis in accordance with GAAP) of Debt during
the period in question, (iii) all amounts payable under non-cancelable
Operating Leases (determined as aforesaid) during such period, and (iv) all
amounts payable with respect to Capital Leases (determined on a
consolidated basis in accordance with GAAP) for the period in question.
1.54 FUNDING SHARE: shall mean the amount of any Advance which each
Syndication Party is required to fund, which shall be determined as
follows: (a) for an Advance under the 7 Year Revolving Loan, the amount of
such Advance multiplied by such Syndication Party's Individual 7 Year Pro
Rata Share as of, but without giving effect to, such Advance, and (b) for
an Advance under the 10 Year Revolving Loan, the amount of such Advance
multiplied by such Syndication Party's Individual 10 Year Pro Rata Share as
of, but without giving effect to, such Advance.
1.55 GAAP: generally accepted accounting principles in the United
States of America, applied consistently, as in effect from time to time.
1.56 GOOD FAITH CONTEST: means the contest of an item if (a) the item
is diligently contested in good faith by appropriate proceedings timely
instituted, (b) either the item is (i) bonded or (ii) adequate reserves are
established with respect to the contested item if and to the extent
reasonably satisfactory to the Required Lenders, and (c) during the period
of such contest, the enforcement of any contested item is effectively
stayed.
1.57 GOVERNMENTAL AUTHORITY: means any nation or government, any
state or other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of
or pertaining to government.
1.58 XXXXXXX LOAN: shall mean the loan to Borrower from Xxxx Xxxxxxx
Mutual Life Insurance Company and Signature 1A (Cayman), Ltd. in the
maximum principal amount of $85,000,000.00 made pursuant to that certain
Second Amended and Restated Note Purchase Agreement dated as of July 15,
2000, as it may be amended from time to time (provided that the principal
amount owing does not exceed $85,000,000.00) and the notes issued
thereunder and providing a maturity date for said notes of February 28,
2006 or earlier.
1.59 XXXXXX LOAN: the loans, letters of credit and reimbursement
obligations relating to letters of credit in the current principal amount
of not more than $125,239,728.00 to Borrower from Xxxxxx Trust and Savings
Bank (individually and as Agent), U.S. Bancorp Ag Credit, Inc., CoBank,
ACB, SunTrust Bank, Atlanta, and Credit Agricole Indosuez, and their
respective successors and assigns, pursuant to that certain Second Amended
and Restated Secured Credit Agreement dated as of November 5, 1999, as it
may be amended from time to time (provided that the principal amount owing
does not exceed $125,239,728.00).
1.60 HAZARDOUS SUBSTANCES: dangerous, toxic or hazardous pollutants,
contaminants, chemicals, wastes, materials or substances, as defined in or
governed by the provisions of any Environmental Laws or any other federal,
state or local law, statute, code, ordinance, regulation, requirement or
rule relating thereto ("ENVIRONMENTAL REGULATIONS"), and also including
urea formaldehyde, polychlorinated biphenyls, asbestos, asbestos-containing
materials, nuclear fuel or waste, and petroleum products, or any other
waste, material, substances, pollutant or contaminant which would subject
an owner of property to any damages, penalties or liabilities under any
applicable Environmental Regulations.
1.61 INDIVIDUAL COMMITMENT: shall mean with respect to any
Syndication Party, its Individual 10 Year Commitment or its Individual 7
Year Commitment, as applicable.
1.62 INDIVIDUAL OUTSTANDING 7 YEAR OBLIGATIONS: shall mean with
respect to any Syndication Party the total at any time, without
duplication, of (a) the aggregate outstanding principal amount of all 7
Year Advances made by such Syndication Party (after giving effect to the
Reallocation), and (b) all of such Syndication Party's Committed 7 Year
Advances.
1.63 INDIVIDUAL OUTSTANDING 10 YEAR OBLIGATIONS: shall mean with
respect to any Syndication Party the total at any time, without
duplication, of (a) the aggregate outstanding principal amount of all 10
Year Advances made by such Syndication Party (after giving effect to the
Reallocation), (b) all of such Syndication Party's Committed 10 Year
Advances.
1.64 INDIVIDUAL PRO RATA SHARE: shall mean with respect to any
Syndication Party at any time a fraction, expressed as a percentage
(rounded to 8 decimal points), where the numerator is the sum of such
Syndication Party's Individual 7 Year Commitment plus its Individual 10
Year Commitment, and the denominator is the Aggregate Commitment.
1.65 INDIVIDUAL 7 YEAR COMMITMENT: shall mean with respect to any
Syndication Party the amount shown as its Individual 7 Year Commitment on
SCHEDULE 1 hereto, subject to adjustment in the event of the sale of all or
a portion of a Syndication Interest in accordance with Section 14.27
hereof, or a reduction in the Aggregate 7 Year Commitment in accordance
with Section 2.8 hereof.
1.66 INDIVIDUAL 7 YEAR LENDING CAPACITY: shall mean with respect to
any Syndication Party the amount at any time of its Individual 7 Year
Commitment, less its Individual Outstanding 7 Year Obligations.
1.67 INDIVIDUAL 7 YEAR PRO RATA SHARE: shall mean with respect to any
Syndication Party a fraction, expressed as a percentage (rounded to 8
decimal points), where the numerator is such Syndication Party's Individual
7 Year Commitment; and the denominator is the Aggregate 7 Year Commitment,
determined (a) in the case of LIBO Rate Loans, at 12:00 noon (Central
time) on the Banking Day Borrower delivers a Borrowing Notice pursuant to
which Borrower requests such LIBOR Loan, and (b) in all other cases, 12:00
noon (Central time) on the Banking Day Borrower delivers a Borrowing
Notice.
1.68 INDIVIDUAL 10 YEAR COMMITMENT: shall mean with respect to any
Syndication Party the amount shown as its Individual 10 Year Commitment on
SCHEDULE 1 hereto, subject to adjustment in the event of the sale of all or
a portion of a Syndication Interest in accordance with Section 14.27
hereof, or a reduction in the Aggregate 10 Year Commitment in accordance
with Section 3.8 hereof.
1.69 INDIVIDUAL 10 YEAR LENDING CAPACITY: shall mean with respect to
any Syndication Party the amount at any time of its Individual 10 Year
Commitment, less its Individual Outstanding 10 Year Obligations.
1.70 INDIVIDUAL 10 YEAR PRO RATA SHARE: shall mean with respect to
any Syndication Party a fraction, expressed as a percentage (rounded to 8
decimal points), where the numerator is such Syndication Party's Individual
10 Year Commitment; and the denominator is the Aggregate 10 Year
Commitment, determined (a) in the case of LIBO Rate Loans, at 12:00 noon
(Central time) on the Banking Day Borrower delivers a Borrowing Notice
pursuant to which Borrower requests such LIBOR Loan, and (b) in all other
cases, 12:00 noon (Central time) on the Banking Day Borrower delivers a
Borrowing Notice.
1.71 INTANGIBLE ASSET: means, license agreements, trademarks, trade
names, patents, capitalized research and development, proprietary products
(the results of past research and development treated as long term assets
and excluded from inventory) and goodwill (all determined on a consolidated
basis in accordance with GAAP.
1.72 INTEREST EXPENSE: means all interest charges during such period,
including all amortization of debt discount expense and imputed interest
with respect to Capital Lease obligations, determined on a consolidated
basis in accordance with GAAP.
1.73 INVESTMENT: means, with respect to any Person, (a) any loan or
advance by such Person to any other Person, (b) the purchase or other
acquisition by such Person of any capital stock, obligations or securities
of, or any capital contribution to, or investment in, or the acquisition by
such Person of all or substantially all of the assets of, or any interest
in, any other Person, (c) any performance or standby letter of credit where
(i) that Person has the reimbursement obligation to the issuer, and
(ii) the proceeds of such letter of credit are to be used for the benefit
of any other Person, (d) the agreement by such Person to make funds
available for the benefit of another Person to either cover cost overruns
incurred in connection with the construction of a project or facility, or
to fund a debt service reserve account, (e) the agreement by such Person to
assume, guarantee, endorse or otherwise be or become directly or
contingently responsible or liable for the obligations or Debts of any
other Person (other than by endorsement for collection in the ordinary
course of business), (f) an agreement to purchase any obligations, stocks,
assets, goods or services but excluding an agreement to purchase any
assets, goods or services entered into in the ordinary course of business,
(g) an agreement to supply or advance any funds, assets, goods or services
entered into outside the ordinary course of business, or (h) an agreement
to maintain or cause such Person to maintain a minimum working capital or
net worth or otherwise to assure the creditors of any Person against loss.
1.74 LEVERAGE RATIO: the ratio for the Borrower and its Consolidated
Subsidiaries of (a) the aggregate outstanding principal amount of all Debt
; LESS unrestricted cash and cash equivalents, to (b) the sum of aggregate
outstanding principal amount of all Debt included in clause (a) above; LESS
unrestricted cash and cash equivalents PLUS Net Worth.
1.75 LIBO RATE: the rate (rounded upwards, if necessary, to the next
1/16{th} of one percent) for deposits in U.S. dollars with maturities
comparable to the selected LIBO Rate Period that appears on the display
designated as Page "3750" of the Telerate Service (or such other Page as
may replace the 3750 Page of that service or, if the Telerate Service shall
cease displaying such rates, as published by such other service or services
as may be nominated by the British Bankers' Association for the purpose of
displaying London Interbank Offered Rates for U.S. Dollar deposits or, if
none, the comparable reference on the Reuters Screen LIBOR Page or such
other quotation service as may be chosen by the Administrative Agent),
determined effective as of 1:00 P.M. (Central Time) on the day which is two
(2) Banking Days prior to the first day of each LIBO Rate Period, reserve
adjusted basis for Regulation D on a demonstrated basis, with such rate
modified by adding the 7 Year LIBOR Margin or the 10 Year LIBOR Margin,
depending on whether the LIBO Rate Loan is being made under the 7 Year
Revolving Loan or the 10 Year Revolving Loan, respectively.
1.76 LIEN: means with respect to any asset any mortgage, deed of
trust, pledge, security interest, hypothecation, assignment for security
purposes, encumbrance, lien (statutory or other), or other security
agreement or charge, or encumbrance of any kind or nature whatsoever
(including, without limitation, any conditional sale, Capital Lease or
other title retention agreement related to such asset).
1.77 LOANS: shall mean, collectively, all Base Rate Loans and all
LIBO Rate Loans outstanding at any time.
1.78 LOAN DOCUMENTS: this Credit Agreement, the other Amendment
Documents, the Notes and the Security Documents.
1.79 MATERIAL ADVERSE EFFECT: means: (a) a material adverse effect
on the financial condition, results of operation, business or property of
Borrower and the Subsidiaries, considered in the aggregate; or (b) a
material adverse effect on the ability of Borrower to perform its
obligations under this Credit Agreement and the other Loan Documents.
1.80 MATERIAL AGREEMENTS: all agreements of a Person, the termination
or breach of which, based upon the knowledge of such Person (or such other
Person as may be specifically designated herein) as of the date of making
any representation with respect thereto, would have a Material Adverse
Effect.
1.81 MERGER: the merger between WLR and Acquisition Corp., as
contemplated by the Acquisition Agreement, pursuant to which: (a) each
outstanding share of issued and outstanding capital stock of WLR ("WLR
STOCK") is cancelled in return for a cash payment; (b) all outstanding
options, warrants, to purchase WLR Stock, and all other equity interests in
WLR are either cancelled in return for a cash payment or paid in cash upon
exercise; (c) all indebtedness for borrowed money of WLR, Xxxxxxx, and the
Xxxxxxx Subsidiaries is paid off and discharged; (d) the surviving Person
and its name shall be changed to Pilgrim's Pride Corporation of Virginia,
Inc. and each share of common stock of Acquisition Corp. is converted into
and exchanged for one validly issued, fully paid and non-assessable share
of common stock of Survivor.
1.82 MERGER CONSUMMATION DATE: the date on which the Merger is
consummated as evidenced by the filing of articles of merger with, and
approval of the articles of merger by, the State Corporation Commission of
the Commonwealth of Virginia in such form as is required by, and executed
in accordance with the relevant provisions of, the Stock Corporation Act of
the Commonwealth of Virginia.
1.83 MULTIEMPLOYER PLAN: means a Plan defined as such in Section
3(37) of ERISA.
1.84 NET TANGIBLE ASSETS: the excess of the value of total assets (as
determined in accordance with GAAP) over the value of Intangible Assets of
the Borrower and its Consolidated Subsidiaries.
1.85 NET WORKING CAPITAL: the excess for the Borrower and its
Consolidated Subsidiaries of Current Assets over Current Liabilities.
1.86 NET WORTH: the total assets (as determined in accordance with
GAAP) minus the Total Liabilities of the Borrower and its Consolidated
Subsidiaries, all determined on a consolidated basis as in accordance with
GAAP.
1.87 NOTE OR NOTES: the promissory notes executed by Borrower
pursuant to Sections 2.3 and 3.3 hereof, and all amendments, renewals,
substitutions and extensions thereof.
1.88 OPERATING LEASE: means any lease of property (whether real,
personal or mixed) for a period of longer than one year by a Person under
which such Person is lessee, other than a Capital Lease.
1.89 ORGANIZATIONAL DOCUMENTS: in the case of a corporation, its
articles or certificate of incorporation and bylaws; in the case of a
partnership, its partnership agreement and certificate of limited
partnership, if applicable; in the case of a limited liability company, its
articles of organization and its operating agreement, limited liability
company agreement or regulations.
1.90 PARI PASSU LOAN: shall mean a loan which meets all of the
following requirements: (a) the proceeds are all made available to
Borrower; (b) it is secured by all or a portion of the Collateral equally
and ratably with the Bank Debt on the same lien priority basis; (c) the
lender thereunder has executed an intercreditor agreement in form and
substance substantially identical to EXHIBIT 1.90 hereto ("INTERCREDITOR
AGREEMENT"); (d) Borrower has furnished to the Administrative Agent a pro-
forma Available Amount Report with such updated Appraisals as the
Administrative Agent may reasonably require at, or no more than ten
(10) days prior to, the date the Administrative Agent is requested to
execute such intercreditor agreement; provided that no updated Appraisals
will be required so long as (i) the aggregate outstanding principal balance
of all Pari Passu Loans (including the proposed Pari Passu Loan) incurred
since the last Appraisal does not exceed $25,000,000.00 and (ii) the
Leverage Ratio is not greater than fifty five percent (55%); and
(e) Borrower demonstrates to the Administrative Agent, in each case on a
pro-forma basis (including, in each case, the proposed Pari Passu Loan),
(i) that the aggregate outstanding principal amounts owing under all 7 Year
Revolving Notes and all 10 Year Revolving Notes will not exceed the
Available Amount as determined pursuant to clause (b) of Section 1.15
hereof (without regard to clause (a) of such Section), and (ii) compliance
with the financial covenants.
1.91 PERSON: any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation,
limited liability company, cooperative association, institution, or
government or governmental agency (whether national, federal, state,
provincial, county, city, municipal or otherwise, including without
limitation, any instrumentality, division, agency, body or department
thereof), or other entity.
1.92 PLAN: means any plan, agreement, arrangement or commitment which
is an employee benefit plan, as defined in Section 3(3) of ERISA,
maintained by Borrower or any Subsidiary or any ERISA Affiliate or with
respect to which Borrower or any Subsidiary or any ERISA Affiliate at any
relevant time has any liability or obligation to contribute, but excluding
any such plan, arrangement, association or fund that is maintained outside
of the United States primarily for the benefit of persons substantially all
of whom are nonresident aliens.
1.93 POST CLOSING LETTER: means that letter agreement of even date
herewith between Borrower and the Administrative Agent relating to certain
matters required to be completed by Borrower after the Effective Date.
1.94 POTENTIAL DEFAULT: any event, other than an event described in
Section 13.1(a) hereof, which with the giving of notice or lapse of time,
or both, would become an Event of Default.
1.95 PROHIBITED TRANSACTION: means any transaction prohibited under
Section 406 of ERISA or Section 4975 of the Code.
1.96 REPORTABLE EVENT: means any of the events set forth in Section
4043(b) of ERISA or in the regulations thereunder.
1.97 REQUIRED LENDERS: shall mean Syndication Parties whose
Individual 7 Year Commitments and Individual 10 Year Commitments constitute
fifty-one percent (51%) of the Aggregate Commitment. Pursuant to Section
14.26 hereof, Voting Participants shall, under the circumstances set forth
therein, be entitled to voting rights and to be included in determining
whether certain action is being taken by the Required Lenders
1.98 SECURITY DOCUMENTS: the security agreements, mortgages, deeds of
trust, leasehold mortgages or deeds of trust, financing statements, pledge
agreements, leasehold assignment and consents, and/or other documents
executed by Borrower in favor of the Administrative Agent, on behalf of the
Syndication Parties, to secure Borrower's performance of its obligations
under the Notes and other Loan Documents with a lien on the Collateral, all
in form and substance acceptable to the Administrative Agent.
1.99 7 YEAR MATURITY DATE: November 16, 2007.
1.100 7 YEAR REVOLVING LOAN: shall mean the loan facility made
available to Borrower under Article 2 of this Credit Agreement and shall
include the Converted 7 Year Loans.
1.101 SUBSIDIARY: means with respect to any Person: (a) any
corporation in which such Person, directly or indirectly, (i) owns fifty
percent (50%) or more of the outstanding stock thereof, or (ii) has the
power under ordinary circumstances to elect at least a majority of the
directors thereof, or (b) any partnership, association, joint venture,
limited liability company, or other unincorporated organization or entity
with respect to which such Person, directly or indirectly, (i) owns more
than fifty percent (50%) of the outstanding equity interest thereof, or
(ii) has the power under ordinary circumstances to directly or indirectly
control the management thereof; provided however (c) the cooperative
association known as Food Processors Water Cooperative, Inc. shall not be
deemed to be a Subsidiary.
1.102 SUBSIDIARY MERGER: means the merger of Xxxxxxx and Survivor
after the Merger and pursuant to which Survivor or Xxxxxxx is the surviving
Person ("SUBSIDIARY MERGER SURVIVOR").
1.103 SUCCESSOR AGENT: such Person as may be appointed as successor
to the rights and duties of the Administrative Agent as provided in
Section 14.20 of this Credit Agreement.
1.104 SURVIVOR: means the surviving Person of the Merger, which,
after the Merger, shall be known as Pilgrim's Pride Corporation of
Virginia, Inc., and which shall be a Virginia corporation.
1.105 SURVIVOR PLEDGE AGREEMENT: means the Security and Stock Pledge
Agreement in the form of EXHIBIT 1.105 hereto whereby Survivor, to secure
its obligations under the Acquisition Guaranty, grants to the
Administrative Agent, for the benefit of all present and future Syndication
Parties, a first lien security interest in all of its Xxxxxxx Securities
Collateral and all rights with respect thereto, including the right to
receive distributions.
1.106 SYNDICATION PARTIES: shall mean those entities listed on
SCHEDULE 1 hereto, including FCSA in its role as a lender hereunder, but
not in its role as Co-Arranger hereunder, and such Persons as shall from
time to time execute a Syndication Acquisition Agreement substantially in
the form of EXHIBIT 14.25 hereto signifying their election to purchase all
or a portion of the Syndication Interest of any Syndication Party, in
accordance with Section 14.25 hereof, and to become a Syndication Party
hereunder.
1.107 TANGIBLE NET WORTH: the Net Worth minus the amount of all
Intangible Assets of the Borrower and its Consolidated Subsidiaries,
determined on a consolidated basis in accordance with GAAP.
1.108 10 YEAR MATURITY DATE: November 16, 2010.
1.109 10 YEAR REVOLVING LOAN: shall mean the loan facility made
available to Borrower under Article 3 of this Credit Agreement and shall
include the Converted 10 Year Loans.
1.110 TOTAL LIABILITIES: at any date, the aggregate amount of all
liabilities of the Borrower and its Consolidated Subsidiaries determined on
a consolidated basis in accordance with GAAP.
1.111 XXXXXXX: means Xxxxxxx Foods, Inc., a Virginia corporation and,
immediately prior to the Merger, a wholly owned subsidiary of WLR.
1.112 XXXXXXX MORTGAGE(S): means the mortgages and/or deeds of trust,
and/or leasehold mortgages or deeds of trust in substantially the form of
(and subject to comments, if any, from local counsel in the applicable
jurisdictions) EXHIBITS 1.112(A), (B), (C), AND (D) hereto.
1.113 XXXXXXX SECURITY DOCUMENTS: means the security agreements,
Xxxxxxx Mortgages, financing statements, pledge agreements, leasehold
assignment and consents, and/or other documents executed by Survivor in
favor of the Administrative Agent, on behalf of the Syndication Parties, to
secure Survivor's performance of its obligations under the Acquisition
Guaranty with a lien on the Xxxxxxx Collateral, all in form and substance
reasonably acceptable to the Administrative Agent.
1.114 XXXXXXX SUBSIDIARIES: means: (a) Xxxxxxx Supply Company, Inc.,
a Virginia corporation, (b) Valley Rail Service, Inc., a Virginia
corporation, (c) Rockingham Poultry Inc., a Virginia corporation, and (d)
Rockingham Poultry Inc., a Virgin Island corporation.
1.115 WLR: means WLR Foods, Inc., a Virginia corporation.
The following terms are defined in portions of this Credit Agreement
other than Article 1:
ACQUISITION GUARANTY Section 7.2
ACQUISITION STOCK Section 7.1
ADDITIONAL COSTS Section 15.12
ADMINISTRATIVE AGENT Introductory Agreement paragraph
ADVANCE PAYMENT Section 14.1
AFFECTED LOANS Section 9.6
AGGREGATE CONVERSION AMOUNT Subsection 5.1.1
AUTHORIZED OFFICER Subsection 9.1.10
AVAILABLE AMOUNT REPORT DEADLINE Subsection 10.2.11
AVAILABLE AMOUNT REPORT Subsection 10.2.11
BASE RATE LOANS Subsection 4.1.1
BORROWER Introductory Agreement paragraph
BORROWER COLLATERAL Section 7.1
BORROWER PENSION PLAN Subsection 8.10.2
BORROWING NOTICE Section 9.2
CERCLA Section 1.46
CHANGE IN LAW Subsection 4.2.2
COBANK Introductory Agreement paragraph
COBRA Subsection 8.10.12
COMMITMENT FEE Subsection 4.5.1
COMMITMENT FEE FACTOR Subsection 4.6.1
COMMITMENT LETTER Subsection 9.1.8
CONTRIBUTING SYNDICATION PARTIES Section 14.3
CONVERSION DATE Subsections 5.1.1 and 5.1.2
CONVERSION ELECTION Subsection 5.1.1
CONVERTED 7 YEAR LOAN Subsection 5.1.1
CONVERTED 10 YEAR LOAN Subsection 5.1.1
CREDIT AGREEMENT Introductory Agreement paragraph
DELINQUENCY INTEREST Section 14.3
DELINQUENT AMOUNT Section 14.3
DELINQUENT SYNDICATION PARTY Section 14.3
EFFECTIVE DATE Introductory Agreement paragraph
ENVIRONMENTAL REGULATIONS Section 1.60
EVENT OF DEFAULT Section 15.1
EVENT OF SYNDICATION DEFAULT Subsection 14.28.1
FARM CREDIT LAW Section 13.4
FCSA Introductory Agreement paragraph
FEE LETTER Subsection 9.1.8
FUNDING LOSSES Section 5.8
FUNDING LOSS NOTICE Section 5.8
FUNDING NOTICE Section 9.2
INDEMNIFIED AGENCY PARTIES Section 14.17
INDEMNIFIED PARTIES Section 12.1
INTERCREDITOR AGREEMENT Section 1.90
IRS Subsection 8.10.2
LIBO RATE LOAN Subsection 4.1.2
LIBO RATE PERIOD Subsection 4.1.2
LIBO REQUEST Subsection 4.1.2
LICENSING LAWS Section 8.4
MANDATORY PREPAYMENTS Section 5.4
MARGIN REPORT DEADLINE Subsection 4.6.2
MARGINS Subsection 4.6.1
MERGER ADVANCE Section 9.4
1999 CREDIT AGREEMENT Recital A
ORIGINAL EFFECTIVE DATE Recital A
PAYMENT ACCOUNT Section 14.8
PAYMENT DISTRIBUTION Section 14.8
PERMITTED ENCUMBRANCES Section 11.3
PILGRIM LTD Section 7.2
PILGRIM GUARANTY Section 7.2
POST CLOSING LETTER Section 15.8
PRINCIPAL PAYMENT SCHEDULE Subsection 5.1.3
RCRA Section 1.46
REALLOCATION Section 14.31
REDUCTION Section 14.31
REGULATORY CHANGE Subsection 15.12
REQUIRED LICENSES Section 8.9
SCHEDULED PAYMENTS Section 5.1
SUBSIDIARY MERGER CONSUMMATION DATE Section 10.20
SUBSIDIARY MERGER SURVIVOR Section 1.101
NEW NOTES Section 11.14
7 YEAR ADVANCE Section 2.1
7 YEAR BASE RATE MARGIN Section 4.6
7 YEAR LIBOR MARGIN Section 4.6
7 YEAR REVOLVING NOTE(S) Section 2.3
SUCCESSOR AGENT Section 14.20
SURVIVOR STOCK Section 7.1
SYNDICATION ACQUISITION AGREEMENT Section 14.25
SYNDICATION INTEREST Section 14.1
SYNDICATION PARTY ADVANCE DATE Section 14.2
10 7/8% NOTES Section 11.14
10 YEAR ADVANCE Section 3.1
10 YEAR BASE RATE MARGIN Section 4.6
10 YEAR LIBOR MARGIN Section 4.6
10 YEAR REVOLVING NOTE(S) Section 3.3
TITLE INSURER Subsection 9.1.5
TITLE POLICY Subsection 9.1.5
TRANSFER Section 14.25
VOLUNTARY PREPAYMENTS Section 5.3
VOTING PARTICIPANTS Section 14.26
XXXXXXX COLLATERAL Section 7.3
XXXXXXX SECURITIES COLLATERAL Section 7.3
WIRE INSTRUCTIONS Section 14.27
WLR CHICKEN ASSETS Section 7.3
WLR STOCK Section 1.81
WLR TURKEY ASSETS Section 7.3
Article 2. 7 YEAR REVOLVING LOAN
2.1 7 YEAR REVOLVING LOAN. On the terms and conditions set forth in
this Credit Agreement, and so long as no Event of Default or Potential
Default has occurred and is continuing, Borrower, may during the
Availability Period, request an Advance under the 7 Year Revolving Loan ("7
YEAR ADVANCE"), and each of the Syndication Parties severally agrees, to
fund its Individual 7 Year Pro Rata Share of each 7 Year Advance from time
to time during the Availability Period, subject to the following:
2.1.1 INDIVIDUAL SYNDICATION PARTY 7 YEAR COMMITMENT. No
Syndication Party shall be required or permitted to fund 7 Year Advances in
an amount which would exceed its Individual 7 Year Lending Capacity as in
effect at the time of the Administrative Agent's receipt of the Borrowing
Notice requesting such Advance.
2.1.2 INDIVIDUAL SYNDICATION PARTY 7 YEAR PRO RATA SHARE. No
Syndication Party shall be required or permitted to fund 7 Year Advances in
excess of an amount equal to its Individual 7 Year Pro Rata Share
multiplied by the amount of the requested 7 Year Advance.
2.2 AGGREGATE 7 YEAR COMMITMENT; AVAILABLE AMOUNT; MERGER. Borrower
shall not be entitled to request a 7 Year Advance in an amount which:
(a) when added to the aggregate Individual Outstanding 7 Year Obligations
of all Syndication Parties, would exceed the Aggregate 7 Year Commitment;
(b) when added to the aggregate Individual Outstanding 7 Year Obligations
of all Syndication Parties and the aggregate Individual Outstanding 10 Year
Obligations of all Syndication Parties, would exceed the Available Amount;
or (c) when added to the aggregate Individual Outstanding 7 Year
Obligations of all Syndication Parties would, unless the Merger is
consummated and until the occurrence of the Merger Consummation Date,
exceed $60,000,000.00.
2.3 7 YEAR REVOLVING PROMISSORY NOTES. Borrower's obligations to each
Syndication Party under the 7 Year Revolving Loan, including Borrower's
payment obligations with respect to all 7 Year Advances made by such
Syndication Party shall be (a) evidenced by, and bear interest in
accordance with, a single promissory note of Borrower in substantially the
form of EXHIBIT 2.3 hereto duly completed, in the stated maximum principal
amount equal to such Syndication Party's Individual 7 Year Commitment,
payable to such Syndication Party for the account of its Applicable Lending
Office, and maturing as to principal on the 7 Year Maturity Date (each a "7
YEAR REVOLVING NOTE" and collectively, the "7 YEAR REVOLVING NOTES"); and
(b) repaid in accordance with Article 5 hereof and such 7 Year Revolving
Note.
2.4 SYNDICATION PARTY RECORDS. Each Syndication Party shall record on
its books and records the amount of each Advance, the rate and interest
period applicable thereto, all payments of principal and interest, and the
principal balance from time to time outstanding. Each Syndication Party's
record thereof shall be prima facie evidence as to all such amounts and
shall be binding on Borrower absent manifest error. Notwithstanding the
foregoing, Borrower will never be required to pay to any Syndication Party
as principal more than the principal amount of the Loans made by such
Syndication Party.
2.5 USE OF PROCEEDS. The proceeds of the 7 Year Revolving Loan will
be used by Borrower: (a) to finance, through an intercompany loan to, or a
capital investment in, Acquisition Corp. and/or Survivor, the Merger and
the Subsidiary Merger; (b) to fund expansion of Borrower's production and
processing facilities, for future acquisitions, and to repay existing
indebtedness; and (c) for general corporate purposes of Borrower and
Survivor, and Borrower agrees not to request or use such proceeds for any
other purpose. Borrower will not, directly or indirectly, use any part of
such proceeds for the purpose of purchasing or carrying any margin stock
within the meaning of Regulation U of the Board of Governors or to extend
credit to any Person for the purpose of purchasing or carrying any such
margin stock.
2.6 ADVANCES; FUNDING. Borrower may request, and the Syndication
Parties shall fund, Advances under the 7 Year Revolving Loan in the manner
and within the time deadlines as provided in Section 9.2 hereof.
2.7 SYNDICATION PARTY FUNDING FAILURE. The failure of any Syndication
Party to remit its funding share of any requested 7 Year Advance on the
date specified for such Advance shall not relieve any other Syndication
Party of its obligation (if any) to make any Advance on such date, but no
Syndication Party shall be responsible for the failure of any other
Syndication Party to make any Advance to be made by such other Syndication
Party.
2.8 REDUCTION OF AGGREGATE 7 YEAR COMMITMENT. Borrower may, by
written notice to the Administrative Agent on or before 10:00 A.M. (Central
time) on any Banking Day, irrevocably reduce the Aggregate Commitment;
provided that (a) such reduction must be in minimum amounts of one million
dollars ($1,000,000.00) and incremental multiples of $500,000.00; (b) such
reduction shall be allocated between the 7 Year Aggregate Commitment and
the 10 Year Aggregate Commitment on a pro rata basis so that (i) the
portion of such reduction allocated to the 7 Year Aggregate Commitment
shall be determined by multiplying the amount of the Aggregate Commitment
reduction by a fraction the numerator of which is the Aggregate 7 Year
Commitment then in effect and the denominator of which is the Aggregate
Commitment then in effect, and (ii) the portion of such reduction allocated
to the 10 Year Aggregate Commitment shall be determined by multiplying such
reduction amount by a fraction the numerator of which is the Aggregate 10
Year Commitment then in effect and the denominator of which is the
Aggregate Commitment then in effect; and (c) Borrower must simultaneously
make any principal payment necessary (along with any applicable Funding
Losses on account of such principal payment) so that (i) the principal
amount outstanding under the 7 Year Revolving Loan does not exceed the
reduced Aggregate 7 Year Commitment on the date of such reduction, (ii) the
Individual Outstanding 7 Year Obligations owing to any Syndication Party do
not exceed the Individual 7 Year Commitment of that Syndication Party
(after reduction thereof in accordance with the following sentence),
(iii) the principal amount outstanding under the 10 Year Revolving Loan
does not exceed the reduced Aggregate 10 Year Commitment on the date of
such reduction, and (iv) the Individual Outstanding 10 Year Obligations
owing to any Syndication Party do not exceed the Individual 10 Year
Commitment of that Syndication Party (after reduction thereof in accordance
with the following sentence). Upon (y) the reduction of the Aggregate 7
Year Commitment as provided in the preceding sentence, then the Individual
7 Year Commitment of each Syndication Party shall be reduced in the same
proportion as the Individual 7 Year Commitment of such Syndication Party
bears to the Aggregate 7 Year Commitment before such reduction, and (z) the
reduction of the Aggregate 10 Year Commitment as provided in the preceding
sentence, then the Individual 10 Year Commitment of each Syndication Party
shall be reduced in the same proportion as the Individual 10 Year
Commitment of such Syndication Party bears to the Aggregate 10 Year
Commitment before such reduction.
Article 3. 10 YEAR LOAN
3.1 10 YEAR LOAN. On the terms and conditions set forth in this
Credit Agreement, and so long as no Event of Default or Potential Default
has occurred and is continuing, Borrower may, during the Availability
Period, request an Advance under the 10 Year Revolving Loan ("10 YEAR
ADVANCE"), and each of the Syndication Parties severally agrees, to fund
its Individual 10 Year Pro Rata Share of each 10 Year Advance from time to
time during the Availability Period, subject to the following:
3.1.1 INDIVIDUAL SYNDICATION PARTY 10 YEAR COMMITMENT. No
Syndication Party shall be required or permitted to fund 10 Year Advances
in an amount which would exceed its Individual 10 Year Lending Capacity as
in effect at the time of the Administrative Agent's receipt of the
Borrowing Notice requesting such Advance.
3.1.2 INDIVIDUAL SYNDICATION PARTY 10 YEAR PRO RATA SHARE. No
Syndication Party shall be required or permitted to fund 10 Year Advances
in excess of an amount equal to its Individual 10 Year Pro Rata Share
multiplied by the amount of the requested 10 Year Advance.
3.2 AGGREGATE 10 YEAR COMMITMENT; AVAILABLE AMOUNT; MERGER. Borrower
shall not be entitled to request a 10 Year Advance in an amount which:
(a) when added to the aggregate Individual Outstanding 10 Year Obligations
of all Syndication Parties, would exceed the Aggregate 10 Year Commitment;
(b) when added to the aggregate Individual Outstanding 7 Year Obligations
of all Syndication Parties and the aggregate Individual Outstanding 10 Year
Obligations of all Syndication Parties, would exceed the Available Amount;
or (c) when added to the aggregate Individual Outstanding 10 Year
Obligations of all Syndication Parties would, unless the Merger is
consummated, and until the occurrence of the Merger Consummation Date,
exceed $140,000,000.00.
3.3 10 YEAR LOAN PROMISSORY NOTES. Borrower's obligations to each
Syndication Party under the 10 Year Revolving Loan, including Borrower's
payment obligations with respect to all 10 Year Advances made by each
Syndication Party shall (a) be evidenced by, and bear interest in
accordance with, a single promissory note of Borrower in substantially the
form of EXHIBIT 3.3 hereto duly completed, in the stated maximum principal
amount equal to such Syndication Party's Individual 10 Year Commitment,
payable to such Syndication Party for the account of its Applicable Lending
Office, and maturing as to principal on the 10 Year Maturity Date (each a
"10 YEAR REVOLVING NOTE" and collectively, the "10 YEAR REVOLVING NOTES") ;
and (b) repaid in accordance with Article 5 hereof and such 10 Year
Revolving Note.
3.4 SYNDICATION PARTY RECORDS. Each Syndication Party shall record on
its books and records the amount of each Advance, the rate and interest
period applicable thereto, all payments of principal and interest, and the
principal balance from time to time outstanding. The Syndication Party's
record thereof shall be prima facie evidence as to all such amounts and
shall be binding on Borrower absent manifest error. Notwithstanding the
foregoing, Borrower will never be required to pay as principal more than
the principal amount of the Loans made by the Syndication Parties.
3.5 USE OF PROCEEDS. The proceeds of the 10 Year Revolving Loan will
be used by Borrower: (a) to finance, through an intercompany loan to, or a
capital investment in, Acquisition Corp. and/or Survivor, the Merger and
the Subsidiary Merger; (b) to fund expansion of Borrower's production and
processing facilities, for future acquisitions, and to repay existing
indebtedness; and (c) for general corporate purposes of Borrower and
Survivor, and Borrower agrees not to request or use such proceeds for any
other purpose. Borrower will not, directly or indirectly, use any part of
such proceeds for the purpose of purchasing or carrying any margin stock
within the meaning of Regulation U of the Board of Governors or to extend
credit to any Person for the purpose of purchasing or carrying any such
margin stock.
3.6 ADVANCES; FUNDING. Borrower may request, and the Syndication
Parties shall fund, Advances under the 10 Year Revolving Loan in the manner
and within the time deadlines as provided in Section 9.2 hereof.
3.7 SYNDICATION PARTY FUNDING FAILURE. The failure of any Syndication
Party to remit its Funding Share of any requested 10 Year Advance on the
date specified for such Advance shall not relieve any other Syndication
Party of its obligation (if any) to make any Advance on such date, but no
Syndication Party shall be responsible for the failure of any other
Syndication Party to make any Advance to be made by such other Syndication
Party.
3.8 REDUCTION OF AGGREGATE 10 YEAR COMMITMENT. Borrower may, by
written facsimile notice to the Administrative Agent on or before 10:00
A.M. (Central time) on any Banking Day, irrevocably reduce the Aggregate 10
Year Commitment; in the same manner and subject to the same conditions as
set forth in Section 2.8 hereof with respect to reduction of the Aggregate
7 Year Commitment.
Article 4. INTEREST AND FEES
4.1 INTEREST. Interest on all Loans shall be calculated as follows:
4.1.1 BASE RATE OPTION. Unless Borrower requests and receives a
LIBO Rate Loan pursuant to Subsection 4.1.2 hereof, the outstanding
principal balance under the 7 Year Revolving Notes and the 10 Year
Revolving Notes shall bear interest at the Base Rate (each a "BASE RATE
LOAN").
4.1.2 LIBO RATE OPTION. From time to time, and so long as no
Event of Default has occurred and is continuing, at the request of Borrower
included in a Borrowing Notice, all or any part of the outstanding
principal balance under the 7 Year Revolving Notes or the 10 Year Revolving
Notes may bear interest at the LIBO Rate (each a "LIBO RATE LOAN");
provided that Borrower may have no more than ten (10) LIBO Rate Loans
outstanding at any time. To effect this option, the Borrowing Notice must
specify (a) the principal amount that is to bear interest at the LIBO Rate,
which must be a minimum of $1,000,000.00 and in incremental multiples of
$500,000.00 and (b) the period selected by Borrower during which the LIBO
Rate is to be applied ("LIBO RATE PERIOD"), which may be any period of one,
two, three, or six months, provided that LIBO Rate Periods which begin
prior to the 7 Year Maturity Date must mature on or prior to the 7 Year
Maturity Date and LIBO Rate Periods which begin on or after the 7 Year
Maturity Date must mature no later than the 10 Year Maturity Date. In
addition, for the purposes of determining a LIBOR Rate Period, a month
means a period starting on one day in a calendar month and ending on a
numerically corresponding day in the next calendar month; provided that if
there is no numerically corresponding day in the month in which a LIBO Rate
Period is to end, or if a LIBO Rate Period begins on the last day of a
calendar month, then such LIBO Rate Period shall end on the last Banking
Day of the calendar month in which such LIBO Rate Period is to end.
Borrower may convert any Base Rate Loan to a LIBO Rate Loan, or continue a
LIBO Rate Loan, by making a written request therefore ("LIBO REQUEST") to
the Administrative Agent by facsimile, specifying (y) the principal amount
that is to bear interest at the LIBO Rate, which must be a minimum of
$1,000,000.00 and in incremental multiples of $500,000.00 and (z) the LIBO
Rate Period selected by Borrower during which the LIBO Rate is to be
applied. The Administrative Agent shall incur no liability in acting upon
a request which it believed in good faith had been made by a properly
authorized officer of Borrower. Following the expiration of the LIBO Rate
Period for any LIBO Rate Loan, interest shall automatically accrue at the
Base Rate unless Borrower requests and receives another LIBO Rate Loan as
provided in this Subsection.
4.2 ADDITIONAL PROVISIONS FOR LIBO RATE LOANS.
4.2.1 INAPPLICABILITY OR UNAVAILABILITY OF LIBO RATE. If the
Administrative Agent at any time shall reasonably determine that for any
reason adequate and reasonable means do not exist for ascertaining the LIBO
Rate, then the Administrative Agent shall promptly give notice thereof to
Borrower. If such notice is given and until such notice has been withdrawn
by the Administrative Agent, then any portion of the outstanding principal
balance hereof which bears interest determined in relation to the LIBO Rate
shall, subsequent to the end of the LIBO Rate Period applicable thereto,
bear interest at the Base Rate.
4.2.2 CHANGE IN LAW; LIBO RATE LOAN UNLAWFUL. If any law,
treaty, rule, regulation or determination of a court or governmental
authority or any change therein or in the interpretation or application
thereof (each, a "CHANGE IN LAW") shall make it unlawful for any of the
Syndication Parties to (a) advance its Funding Share of any LIBO Rate Loan
or (b) maintain its share of all or any portion of the LIBO Rate Loans,
each such Syndication Party shall promptly, by telephone or facsimile,
notify the Administrative Agent thereof, and of the reasons therefor and
the Administrative Agent shall promptly notify Borrower thereof and if the
notice from such Syndication Party is in writing, the Administrative Agent
shall provide a copy of such notice to Borrower. In the former event, any
obligation of any such Syndication Party to make available its Funding
Share of any future LIBO Rate Loan shall immediately be canceled (and, in
lieu thereof shall be made as a Base Rate Loan), and in the latter event,
any such unlawful LIBO Rate Loans or portions thereof then outstanding
shall be converted, at the option of such Syndication Party, to a Base Rate
Loan; provided, however, that if any such Change in Law shall permit the
LIBO Rate to remain in effect until the expiration of the LIBO Rate Period
applicable to any such unlawful LIBO Rate Loan, then such LIBO Rate Loan
shall continue in effect until the expiration of such LIBO Rate Period.
Upon the occurrence of any of the foregoing events on account of any change
in any law, treaty, rule, regulation or determination of a court or
governmental authority or in the interpretation or application thereof,
Borrower shall pay to the Administrative Agent immediately upon demand such
amounts as may be necessary to compensate any such Syndication Party for
any fees, charges, or other costs incurred or payable by such Syndication
Party as a result thereof and which are attributable to any LIBO Rate Loan
made available to Borrower hereunder, and any reasonable allocation made by
any such Syndication Party among its operations shall be conclusive and
binding upon Borrower absent manifest error. In the event any Syndication
Party provides the Administrative Agent a notice under this Subsection,
then Borrower shall have the right, but not the obligation, upon written
notice to the Administrative Agent, accompanied by the payment of such
amounts as are described above and any applicable Funding Losses on account
of the prepayment required below, on or before 10:00 A.M. (Central time) on
or before ten (10) Banking Days following receipt of such notice, to reduce
the Individual 7 Year Commitment and Individual 10 Year Commitment of such
Syndication Party to zero upon making a prepayment, to be treated as a
Voluntary Payment to the extent not inconsistent with the provisions of
this Subsection, equal to the amount of such Syndication Party's Individual
Outstanding 7 Year Obligations and Individual Outstanding 10 Year
Obligations. In the event Borrower makes such an election, then a
reduction in a dollar amount corresponding to such reduction in Individual
7 Year Commitment and/or Individual 10 Year Commitment shall be made to the
Aggregate 7 Year Commitment and/or Aggregate 10 Year Commitment, as
applicable, and, notwithstanding any provisions of this Credit Agreement to
the contrary, including, without limitation, Sections 2.8 and 3.8: (y) the
amount of such prepayment shall be applied to outstanding LIBO Rate Loans
to the extent of such Syndication Party's Pro Rata Share thereof and, along
with the amount paid on account of such fees, charges, Funding Losses, or
other costs, distributed to the Syndication Party providing such notice and
as to which Borrower has made such election, and (z) any reduction in the
Aggregate 7 Year Commitment on account of the provisions of the immediately
preceding sentence shall not require or result in a reduction in the
Aggregate 10 year Commitment, and any reduction in the Aggregate 10 Year
Commitment on account of the provisions of the immediately preceding
sentence shall not require or result in a reduction in the Aggregate 7 Year
Commitment.
4.3 DEFAULT INTEREST RATE. All past due payments on the Notes or of
any other Bank Debt (whether as a result of nonpayment by Borrower when
due, at maturity, or upon acceleration) shall bear interest at the Default
Interest Rate from and after the due date for the payment, or on the date
of maturity or acceleration, as the case may be.
4.4 INTEREST CALCULATION. Interest on LIBO Rate Loans and Base Rate
Loans shall be calculated on the actual number of days the principal owing
thereunder is outstanding with the daily rate calculated on the basis of a
year consisting of 360 days. In calculating interest, the Advance Date
shall be included and the date each payment is received shall be excluded.
4.5 FEES. Borrower shall pay or cause to be paid the following fees:
4.5.1 COMMITMENT FEE. A FEE FOR EACH DAY DURING THE AVAILABILITY
PERIOD ("COMMITMENT FEE") for each Facility (a) payable in arrears by the
fifteenth day of the month following the close of each Fiscal Quarter, and
(b) determined for each day during such Fiscal Quarter by (i) multiplying
the Commitment Fee Factor in effect on such day (expressed as a daily rate
on the basis of a year of 360 days) times (ii) the difference between the
Aggregate 7 Year Commitment or the Aggregate 10 Year Commitment, as
applicable, in effect on such day, and the outstanding principal balance
owing under such Facility as of the close of the Administrative Agent's
business on such day. The Commitment Fee shall be payable by Borrower to
the Administrative Agent, and the Administrative Agent shall distribute the
portion of the Commitment Fee attributable to the 7 Year Revolving Loan to
the Syndication Parties based on their Individual 7 Year Pro Rata Share and
shall distribute the portion of the Commitment Fee attributable to the 10
Year Revolving Loan to the Syndication Parties based on their Individual 10
Year Pro Rata Share on such day.
4.6 INTEREST RATE MARGINS; COMMITMENT FEE FACTOR. The Margins and the
Commitment Fee Factor shall be determined as follows:
4.6.1 CALCULATION. "7 YEAR BASE RATE MARGIN", the "7 YEAR LIBOR
MARGIN", the "10 YEAR BASE RATE MARGIN", the "10 YEAR LIBOR MARGIN"
(collectively the "MARGINS"), and the "COMMITMENT FEE FACTOR" shall be
determined pursuant to the table below (expressed in basis points) based on
the Leverage Ratio, as of the end of each Fiscal Quarter, with such Margins
effective as of the fifth Banking Day after receipt of a Compliance
Certificate as required pursuant to Subsection 4.6.2 hereof (and it being
expressly understood that the 7 Year LIBOR Margin and the 10 Year LIBOR
Margin once set for a LIBO Rate Loans will not change during the LIBOR Rate
Period therefore based upon a subsequent change in the Leverage Ratio;
provided that the 7 Year LIBOR Margins and the 10 Year LIBOR Margins for
LIBO Rate Loans existing on the Merger Consummation Date are subject to
change during the LIBOR Rate Period therefore based upon a change in the
Leverage Ratio calculated pursuant to clause (a) of this Subsection),
except that (a) the Compliance Certificate required pursuant to Subsection
4.6.2 hereof with respect to the initial Merger Advance shall report the
Leverage Ratio as of, and after giving effect to, the Merger; (b) the
Margins and Commitment Fee Factor effective as of the Closing Date shall be
based on the last Compliance Certificate provided pursuant to the 1999
Credit Agreement (or in accordance with clause (d) of this Subsection if no
such Compliance Certificate was provided); (c) in the event that the final
annual audited financial statements establish the Borrower was not entitled
to a reduction in the Margin and the Commitment Fee Factor previously
granted based upon a Compliance Certificate, Borrower shall, upon written
demand by the Administrative Agent, pay any excess amount which should have
been charged based on such annual audited financial statements; and (d) if
the Compliance Certificate is not received by Administrative Agent by the
Margin Report Deadline, the Margin and the Commitment Fee Factor for the
period commencing on the first Banking Day after the Margin Report Deadline
will each be based on a Leverage Ratio of 65.0% continuing until the fifth
Banking Day after such time as Borrower delivers the Compliance Certificate
to the Administrative Agent, after which time the Margin and the Commitment
Fee Factor will be based on such Compliance Certificate:
7 Year 7 Year Commitment
LEVERAGE LIBOR RATE MARGIN BASE FEE FACTOR
RATIO RATE
MARGIN
Less than 35% 100.0 basis points 0 25.0
BASIS basis points
POINTS
35% to 125.0 BASIS POINTS 0 25.0
40% BASIS BASIS POINTS
POINTS
40% to 45% 137.5 BASIS POINTS 0 37.5
BASIS BASIS POINTS
POINTS
45% to 50% 150.0 BASIS POINTS 0 37.5
BASIS BASIS POINTS
POINTS
50% to 55% 175.0 BASIS POINTS 0 42.5
BASIS BASIS POINTS
POINTS
55% to 60% 200.0 BASIS POINTS 25.0 50.0
BASIS BASIS POINTS
POINTS
60% to 65% 225.0 BASIS POINTS 25.0 50.0
BASIS BASIS POINTS
POINTS
Greater than 65% 250.0 BASIS POINTS 25.0
BASIS 50.0 BASIS
POINTS POINTS
10 Year 10 Year Commitment
LEVERAGE LIBOR RATE MARGIN BASE FEE FACTOR
RATIO RATE
MARGIN
Less than 35% 112.5 basis points 0 25.0
BASIS basis points
POINTS
35% to 40% 137.5 BASIS POINTS 0 25.0
basis basis points
points
40% to 45% 162.5 basis points 0 37.5
basis basis points
points
45% to 50% 175.0 basis points 0 37.5
basis basis points
points
50% to 55% 200.0 basis points 0 42.5
basis basis points
points
55% to 60% 225.0 basis points 25.0 50.0
basis basis points
points
60% to 65% 250.0 basis points 25.0 50.0
basis basis points
points
Greater than 65% 275.0 basis points 25.0
basis 50.0 basis
points points
4.6.2 COMPLIANCE CERTIFICATE. On or before (a) the 45th day
after the beginning of the second, third and fourth Fiscal Quarter of each
Fiscal Year and on or before the 90{th} day after the beginning of the
first Fiscal Quarter of each Fiscal Year ("MARGIN REPORT DEADLINE"),
commencing with the Fiscal Quarter which begins in October of 1999, and (b)
the date of submitting to the Administrative Agent the initial Borrowing
Notice with respect to a Merger Advance, Borrower shall provide to the
Administrative Agent the Compliance Certificate required pursuant to
Subsections 10.2.1 and 10.2.2 hereof, which shall include a statement as to
the Leverage Ratio as of the last day of the preceding Fiscal Quarter.
4.7 MAXIMUM INTEREST RATE. Borrower acknowledges and agrees that 12
U.S.C. section 2205 provides that institutions of the Farm Credit System
are not subject to any interest rate limitation imposed by any state
constitution or statute or other laws, and that any such limitations are
preempted, and that therefore interest owing under the Notes, to the extent
funded by an institution of the Farm Credit System, is not subject to any
ceiling. Nonetheless, in the event it is ever determined by a court of
competent jurisdiction that interest owing on the Notes, or some of them,
is subject to any limitations imposed by the laws of the State of Colorado
or Texas or any other jurisdiction, it is the intent of Borrower, and the
Syndication Parties to, notwithstanding the provisions of Section 4.1
hereof, at all times comply with the applicable usury laws relating to this
Credit Agreement or the Notes now or hereafter in effect including, without
limitation, Title 4 of the Texas Finance Code and any subsequent revisions
or judicial interpretations thereof if, and to the extent, determined by a
court to be applicable to the Notes. It is agreed that the aggregate of
all interest and other charges constituting interest, or adjudicated as
constituting interest, and contracted for, chargeable, or receivable in
connection with the Notes shall under no circumstances exceed the maximum
nonusurious amount of interest permitted by applicable law. If the
applicable laws are ever revised or judicially interpreted so as to render
usurious any amount called for under this Credit Agreement or the Notes or
contracted for, charged, chargeable, received or receivable with respect to
this Credit Agreement or the Notes, or if the exercise of the option to
accelerate the maturity of the Notes, or if any payment, results in
Borrower having paid any interest on one or more of the Notes in excess of
that permitted by applicable law, any such construction shall be subject to
the provisions of this Section and, to the extent permitted by applicable
law all excess amounts collected on such Notes shall be credited on the
principal balance of such Notes (or, if it has been paid in full, refunded
to Borrower), and those provisions shall immediately be deemed reformed and
the amounts thereafter collectible will be reduced, without the necessity
of the execution of any new documents, so as to comply with the then
applicable law, but so as to permit the recovery of the fullest amount of
interest otherwise lawfully called for under this Credit Agreement or the
Notes. In the event the maturity of any Note is accelerated, then earned
interest may never include more than the maximum amount of interest
permitted by applicable law from the date of each advance of the proceeds
of such Note until paid. Specifically, but without in any way limiting the
generality of the foregoing, if from any circumstances whatsoever
fulfillment of any provision of this Credit Agreement or the Notes, at the
time performance of such provision is due, would cause the interest
contracted for, charged, chargeable, received or receivable with respect to
this Credit Agreement or any of the Notes to exceed the amount permitted by
applicable law, then ipso facto and notwithstanding anything to the
contrary contained herein, Borrower shall only be required to pay interest
on each such Note in an amount equal to the lesser of the amounts payable
under this Credit Agreement and the maximum amount permitted by applicable
law. In determining whether the amount of interest contracted for,
charged, chargeable, received or receivable with respect to this Credit
Agreement or any of the Notes would ever exceed the amount permitted by
applicable law, all sums charged, paid or agreed to be paid under this
Credit Agreement for the use, forbearance, or detention of the indebtedness
of Borrower to the Administrative Agent and/or the Syndication Parties
shall, to the extent possible under applicable law, be amortized, prorated,
allocated, and spread throughout the full term of the Notes (including any
renewal or extension), until payment in full. The provisions of this
Section control all agreements between the Administrative Agent and/or the
Syndication Parties and Borrower relative to the Notes. In the event any
interest is required to be credited to principal or refunded to Borrower
with respect to some, but not all, of the Notes, such adjustment shall be
for the account of the Syndication Party which is the payee under such Note
or Notes, and shall not affect the other Notes or the Syndication Parties
which are the payees under such other Notes.
Article 5. PAYMENTS; FUNDING LOSSES
5.1 PRINCIPAL PAYMENTS. Principal shall be payable under the 7 Year
Converted Loans and the 10 Year Converted Loans (including, in each case,
Converted Loans effected by an automatic conversion) in quarterly payments
in the amounts and on the dates set forth in the Principal Payment Schedule
("SCHEDULED PAYMENTS"), with all unpaid principal due on the 7 Year
Maturity Date or the 10 Year Maturity Date, as applicable.
5.1.1 CONVERTED LOANS. Borrower may, upon not more than seven
and not less than three Banking Day's advance notice to the Administrative
Agent, during the Availability Period elect ("CONVERSION ELECTION"),
effective as of the last Banking Day of each June and December (each a
"CONVERSION DATE"), to convert a specific dollar amount ("AGGREGATE
CONVERSION AMOUNT") (a) of the 7 Year Revolving Loan into one or more term
loans (each a "CONVERTED 7 YEAR LOAN") having a final maturity on the 7
Year Maturity Date and with amortization in equal quarterly payments of
principal based on the period from the Conversion Date to the sixth
anniversary following the end of the Availability Period (which will
require a balloon payment on the 7 Year Maturity Date) and (b) of the 10
Year Revolving Loan into one or more term loans (each a "CONVERTED 10 YEAR
LOAN") having a final maturity on the 10 Year Maturity Date and with
amortization in equal quarterly payments of principal based on the period
from the Conversion Date to the eleventh anniversary following the end of
the Availability Period (which will require a balloon payment on the 10
Year Maturity Date); PROVIDED that (x) such conversion must be in minimum
amounts of $1,000,000.00 and incremental multiples of $500,000.00, (y) the
Aggregate Conversion Amount must be allocated between the 7 Year Revolving
Loan and the 10 Year Revolving Loan on the basis of the ratio of the
Aggregate 7 Year Commitment or the Aggregate 10 Year Commitment, as
applicable, to the Aggregate Commitment in effect, in each case, on the
Conversion Date. Amounts converted to a Converted 7 Year Loan will
permanently reduce the Aggregate 7 Year Commitment dollar-for-dollar, and
the aggregate outstanding principal balance of the 7 Year Revolving Loan
and Converted 7 Year Loans may not at any time exceed the Aggregate 7 Year
Commitment then in effect, and amounts converted to a Converted 10 Year
Loan will permanently reduce the Aggregate 10 Year Commitment dollar-for-
dollar, and the aggregate outstanding principal balance of the 10 Year
Revolving Loan and Converted 10 Year Loans may not at any time exceed the
Aggregate 10 Year Commitment then in effect.
5.1.2 AUTOMATIC CONVERSION. Outstanding balances of principal
under the 7 Year Revolving Loan (and not previously converted) will be
automatically converted into a Converted 7 Year Loan as of the last day of
the Availability Period, and outstanding balances of principal under the 10
Year Revolving Loan (and not previously converted) will be automatically
converted into a Converted 10 Year Loan as of the last day of the
Availability Period. With respect to loans automatically converted
pursuant to this Subsection, the last day of the Availability Period shall
be deemed to be the "CONVERSION DATE".
5.1.3 PRINCIPAL PAYMENT SCHEDULE. The Administrative Agent will
maintain, in the form of EXHIBIT 5.1.3 hereto, a schedule of principal
payments ("PRINCIPAL PAYMENT SCHEDULE") showing (a) on a consolidated basis
the schedule of principal payments due under all Converted 7 Year Loans,
and (b) on a consolidated basis the schedule of principal payments due
under all Converted 10 Year Loans. The Administrative Agent will update
the Principal Payment Schedule as of each Conversion Date with respect to
which Borrower has made a Conversion Election and on the Banking Day
following the last day of the Availability Period, and the Principal
Payment Schedule as so updated will automatically replace and supersede
EXHIBIT 5.1.3 hereto.
5.2 INTEREST PAYMENTS. Interest shall be payable as follows:
(a) interest on Base Rate Loans shall be payable monthly in arrears on the
fifteenth day of the following month, (b) interest on LIBO Rate Loans shall
be payable in arrears on the last day of the LIBO Rate Period therefor
unless the LIBO Rate Period is longer than three (3) months, in which case
interest shall also be payable every three (3) months from the date of the
relevant Advance and (c) interest on all Loans then accrued and unpaid
shall be payable on the 7 Year Maturity Date or 10 Year Maturity Date, as
applicable.
5.3 VOLUNTARY PREPAYMENTS. Borrower shall have the right to prepay
("VOLUNTARY PREPAYMENTS") all or any part of the outstanding principal
balance under the Loans at any time in minimum amounts of $1,000,000.00 and
in integral multiples of $500,000.00 (or the entire outstanding balance, if
less) on any Banking Day; provided that (a) in the event of prepayment of
any LIBO Rate Loan (i) Borrower must provide three (3) Banking Days notice
to the Administrative Agent prior to making such prepayment, and
(ii) Borrower must, at the time of making such prepayment, pay all Funding
Losses applicable to such prepayment. Principal amounts paid or
voluntarily prepaid (except as applied to a Converted Loan) may be
reborrowed under the terms and conditions of this Credit Agreement.
5.4 MANDATORY PREPAYMENTS. Borrower shall be required to make
prepayments ("MANDATORY PREPAYMENTS") in each of the following events
(a) in the event any of the Collateral (including, after the Merger
Consummation Date, whether or not the Administrative Agent has, for the
benefit of the Syndication Parties, been granted a lien thereon, the
Acquisition Stock, the Xxxxxxx Securities Collateral, the WLR Chicken
Assets, and the WLR Turkey Assets) is the subject of a Casualty Event, a
Mandatory Prepayment equal to the amount of the Casualty Proceeds received
by Borrower, Survivor, or Subsidiary Merger Survivor on account thereof
(provided that no such Mandatory Prepayment shall be required to the extent
that Borrower, Survivor, or Subsidiary Merger Survivor, as applicable, use
such Casualty Proceeds for repair or replacement for any Casualty Event if
the amount of Casualty Proceeds does not exceed $25,000,000.00, or such
higher amount as may be approved by the Required Lenders at their
discretion, and so long as (i) a contract for such repair or replacement is
entered into within 180 days of such Casualty Event for such repairs and/or
the acquisition of such replacements, (ii) such repair or replacement is
effected within 360 days of such Casualty Event, and (iii) any such
replacements are covered by the lien in favor of the Administrative Agent
on the Collateral); (b) upon the issuance of any equity securities in a
capital raising transaction resulting in net proceeds to Borrower of an
amount in excess of $10,000,000.00, a Mandatory Prepayment equal to fifty
percent (50%) of net proceeds of such offering of equity securities to the
extent they are not used, under the conditions set forth below, for
acquisitions and/or capital investment within 360 days of receipt; (c) upon
sale or other disposition of any non-current assets (except for sales in
the ordinary course of business) (i) which are not a part of the
Collateral, a Mandatory Prepayment equal to one hundred percent (100%) of
the net proceeds in excess of $5,000,000 received by Borrower, Survivor, or
Subsidiary Merger Survivor to the extent that they are not used, under the
conditions set forth below, for acquisitions and/or capital investment
within 360 days of receipt by Borrower, Survivor, or Subsidiary Merger
Survivor, as applicable, or (ii) which are a part of the Collateral
(including, after the Merger Consummation Date, whether or not the
Administrative Agent has, for the benefit of the Syndication Parties, been
granted a lien thereon, the Acquisition Stock, the Xxxxxxx Securities
Collateral, the WLR Chicken Assets, and the WLR Turkey Assets), a Mandatory
Prepayment equal to one hundred percent (100%) of the net proceeds in
excess of $5,000,000 received by Borrower, Survivor, or Subsidiary Merger
Survivor to the extent that they are not used, under the conditions set
forth below, for acquisitions and/or capital investment within 360 days of
receipt by Borrower, Survivor, or Subsidiary Merger Survivor, as
applicable, which are (except to the extent acquired with the proceeds of
the sale of WLR Turkey Assets) covered by a lien in favor of the
Administrative Agent; and (d) at any time that the aggregate outstanding
principal balance owing (i) under the 7 Year Revolving Loan and the 10 Year
Revolving Loan (including the Converted Loans) exceeds the Available Amount
or (ii) under either the 7 Year Revolving Loan or the 10 Year Revolving
Loan (including the 7 Year Converted Loans or the 10 Year Converted Loans,
as applicable) exceeds the Aggregate 7 Year Commitment or the Aggregate 10
Year Commitment, respectively, as either of them may be reduced from time
to time, a Mandatory Prepayment equal to the amount of such excess. In
each case of proceeds from any offering of equity securities and from any
sale or other disposition of assets, to avoid Mandatory Prepayment based
thereon, Borrower, Survivor, or Subsidiary Merger Survivor, as applicable,
must, within 180 days of receipt of such proceeds, have used such proceeds
for acquisitions and/or capital investments or executed a binding
definitive contract for such acquisitions and/or capital investments.
Mandatory Prepayments made (x) pursuant to clause (d) of this Section and
applied to Converted Loans or (z) pursuant to clauses (a), (b), and (c) of
this Section, will, in either case, result in a permanent reduction of the
Aggregate 7 Year Commitment and the Aggregate 10 Year Commitment to the
extent of the Mandatory Payments applied to each such Facility. Mandatory
Prepayments under clauses (a), (b), or (c) shall be due no later than 10
Banking Days after the expiration of the applicable acquisition or capital
investment period set forth above, and Mandatory Prepayments under
(d) shall be due the next Banking Day following such occurrence. In
determining the amount of Mandatory Prepayment required under clauses
(a) or (c)(ii), Borrower shall be permitted to make any prepayment required
on account of such Casualty Event or sale under any Pari Passu Loan (in a
maximum amount no greater than the pro rata portion based on total
outstanding principal balances of such loan and the Facilities), and in
determining the amount of Mandatory Prepayment required under clauses
(b) and (c)(i), Borrower shall, without duplication regarding payments made
on account of any Pari Passu Loan, be permitted to make any prepayment
required on account of such sale under any secured or unsecured credit
facility which is not expressly subordinate to the Facilities in a maximum
amount, with respect only to such unsecured facilities, of no greater than
the pro rata portion based on the total outstanding principal balances
owing under such unsecured facility to the sum of the total outstanding
principal balances owing under all such unsecured facilities and under the
Facilities.
5.5 APPLICATION OF PRINCIPAL PAYMENTS.
5.5.1 SCHEDULED PAYMENTS. All Scheduled Payments shall be
applied to one or more 7 Year Converted Loans or one or more 10 Year
Converted Loans in accordance with the Principal Payment Schedule.
5.5.2 VOLUNTARY PREPAYMENTS. All Voluntary Prepayments shall be
applied to principal amounts owing under the 7 Year Revolving Loan and the
10 Year Revolving Loan in the ratio of the amount of the outstanding
principal balance owed under each, divided by the principal balance owed
under both, determined in each case on the date of such prepayment, and,
unless Borrower directs otherwise in writing (a) shall be applied first to
balances other than Converted Loans, and then to Converted Loans, and
(b) to the extent consistent with provision (a) hereof, first to Base Rate
Loans and then to LIBO Rate Loans. To the extent Voluntary Prepayments are
applied to Converted Loans, they shall be applied FIRST to the four
principal installments next coming due, and SECOND to remaining
installments on a ratable basis. However, notwithstanding any of the
foregoing provisions of this Subsection, upon the occurrence and during the
continuance of an Event of Default, all prepayments shall be applied, as
the Administrative Agent in its sole discretion shall determine, to fees,
interest or principal indebtedness under the Notes, or to any other Bank
Debt.
5.5.3 MANDATORY PREPAYMENTS. All Mandatory Prepayments shall be
applied to principal amounts owing under the 7 Year Revolving Loan and the
10 Year Revolving Loan in the ratio of the amount of the outstanding
principal balance owed under each, divided by the principal balance owed
under both, determined in each case on the date of such prepayment, and
(a) Mandatory Prepayments made on account of clauses (a) or (c) of Section
5.4 hereof shall be applied first to principal balances of Converted Loans,
and Mandatory Prepayments made on account of clauses (b) or (d) of Section
5.4 hereof shall be applied first to principal balances other than under
Converted Loans; and (b) to the extent not inconsistent with clause
(a) hereof, first to Base Rate Loans and then to LIBO Rate Loans. To the
extent Mandatory Prepayments are applied to Converted Loans, on account of
clauses (a) or (c)(ii) of Section 5.4, they shall be applied to Scheduled
Payments in the inverse order of their due date, so that such Mandatory
Prepayments are applied first to the Scheduled Payment last coming due, and
to the extent Mandatory Prepayments are applied to Converted Loans, on
account of clauses (b), (c)(i), or (d) of Section 5.4, they shall be
applied FIRST to the four principal installments next coming due, and
SECOND to remaining installments on a ratable basis.
5.6 MANNER OF PAYMENT. All payments, including prepayments, that
Borrower is required or permitted to make under the terms of this Credit
Agreement shall be made in US dollars to the Administrative Agent (a) in
immediately available federal funds, to be received no later than 1:00 P.M.
Central time of the Banking Day on which such payment is due by wire
transfer through Federal Reserve Bank, Kansas City, Routing Number:
000000000, COBANK ENGWD (or to such other account as the Administrative
Agent may designate by notice); and (b) without setoff or counterclaim and
free and clear of and without deduction for any taxes, levies, impost,
duties, charges, fees, deductions, withholding, compulsory loans,
restrictions or conditions of any nature now or hereafter imposed or levied
by any jurisdiction or any political subdivision thereof or taxing or other
authority therein unless Borrower is required by law to make such deduction
or withholding.
5.7 DISTRIBUTION OF PRINCIPAL AND INTEREST PAYMENTS. The
Administrative Agent shall distribute payments of principal and interest
among the Syndication Parties as follows:
5.7.1 PRINCIPAL AND INTEREST PAYMENTS ON 7 YEAR REVOLVING LOAN.
Principal and interest payments on or applied to the 7 Year Revolving Loan
(including 7 Year Converted Loans) shall be remitted to the Syndication
Parties in accordance with their Individual 7 Year Pro Rata Share.
5.7.2 PRINCIPAL AND INTEREST PAYMENTS ON 10 YEAR REVOLVING LOAN.
Principal and interest payments on or applied to the 10 Year Revolving Loan
(including 10 Year Converted Loans) shall be remitted to the Syndication
Parties in accordance with their Individual 10 Year Pro Rata Share.
5.8 FUNDING LOSSES. "Funding Losses" shall be determined on an
individual Syndication Party basis as the amount which would result in such
Syndication Party being made whole (on a present value basis) for the
actual or imputed funding losses (including, without limitation, any loss,
cost or expense incurred by reason of obtaining, liquidating or employing
deposits or other funds acquired by such Syndication Party to fund or
maintain such LIBO Rate Loan) incurred by such Syndication Party as a
result of such prepayment of LIBO Rate Loans on any day other than the last
day of the LIBO Rate Period applicable thereto. In the event of any such
prepayment, each Syndication Party which had funded the LIBO Rate Loan
being prepaid shall, promptly after being notified of such prepayment, send
written notice ("FUNDING LOSS NOTICE") to the Administrative Agent by
facsimile setting forth the amount of attributable Funding Losses and the
method of calculating the same. The Administrative Agent shall notify
Borrower orally or in writing of the amount of such Funding Losses. A
determination by a Syndication Party as to the amounts payable pursuant to
this Section shall be conclusive absent manifest error. Notwithstanding
the foregoing, each Syndication Party is entitled to fund all or any part
of its Pro Rata Share of any LIBO Rate Loan in any manner it selects, and
it is understood that for the purposes of determining any Funding Losses,
determination shall be made by each Syndication Party as though it had
actually funded and maintained each LIBO Rate Loan through the purchase of
deposits in the relevant interbank market having a maturity corresponding
to the relevant LIBO Rate Period.
Article 6. BANK EQUITY INTERESTS
6.1 PURCHASE OF BANK EQUITY INTERESTS. Borrower agrees to purchase
such equity interests in FCSA ("BANK EQUITY INTERESTS") as FCSA may from
time to time require in accordance with its bylaws and capital plan in
effect as of the date hereof as applicable to non-cooperative borrowers
generally. In connection with the foregoing, Borrower hereby acknowledges
receipt, prior to the execution of this Credit Agreement, of the following
with respect to FCSA (a) the bylaws, (b) a written description of the terms
and conditions under which the Bank Equity Interests are issued, (c) the
most recent annual report, and if more recent than the latest annual
report, the latest quarterly report.
Article 7. SECURITY
7.1 BORROWER'S COLLATERAL. As security for the payment and
performance of all obligations of Borrower to the Administrative Agent, to
FCSA (with respect to the obligations of Borrower under Article 6 hereof),
and to all present and future Syndication Parties, including but not
limited to principal and interest under the Notes, purchases of Bank Equity
Interests, fees, Funding Losses, reimbursements, and all other Bank Debt or
obligations under any of the Loan Documents, Borrower shall grant to, and
maintain for, the Administrative Agent, for the benefit of FCSA (to the
extent of Borrower's obligations with respect to Bank Equity Interests),
and for the benefit of all present and future Syndication Parties, a first
lien and security interest, pursuant to the Security Documents, subject
only to (i) purchase money security interests which would qualify as
Permitted Encumbrances, and (ii) Permitted Encumbrances described in
Section 11.3(a) hereof, in the following ("BORROWER COLLATERAL") in
accordance with the timing set forth in Section 10.3 hereof: (a) all of
Borrower's real property interest, furniture, fixtures and equipment
located at, or used in connection with, the poultry hatching, raising,
slaughtering, processing, packaging, and shipping operations and facilities
identified on EXHIBIT 7.1 hereto; (b) all of Borrower's issued and
outstanding common and preferred stock in (i) Acquisition Corp
("ACQUISITION STOCK"), and (ii) following the consummation of the Merger,
in Survivor, and (iii) following the consummation of the Subsidiary Merger,
in Subsidiary Merger Survivor (the stock referred to in clauses (ii) and/or
(iii) the "SURVIVOR STOCK"); and (c) all proceeds with respect to the
assets described in clauses (a) and (b) above and all insurance policies in
connection with the assets described in clauses (a), (b) and (c) hereof and
the proceeds thereof, in each case whether now owned or hereafter acquired;
provided that only FCSA shall have a lien on the Bank Equity Interests and
none of the Syndication Parties shall have a lien thereon. Borrower shall
execute and deliver to the Administrative Agent, for the benefit of the
Syndication Parties, the Security Documents to evidence the security
interest of the Administrative Agent, for the benefit of the Syndication
Parties, in the Borrower Collateral, together with such financing
statements or other documents as the Administrative Agent shall reasonably
request. Borrower shall also execute such further security agreements,
mortgages, deeds of trust, financing statements, assignments or other
documents as the Administrative Agent shall reasonably request from time to
time, in form and substance as the Administrative Agent shall specify, to
establish, confirm, perfect or provide notice of the Administrative Agent's
security interest (for the benefit of the Administrative Agent and all
Syndication Parties) in the Borrower Collateral. Upon complete
satisfaction of each of the requirements of Subsections 10.3.3 and 10.3.4
hereof, the Administrative Agent (i) will be deemed to have released and
terminated any lien and security interest in the Acquisition Stock and the
Survivor Stock, (ii) will deliver to Borrower any and all certificates in
the Administrative Agent's possession representing the Acquisition Stock
and the Survivor Stock, and (iii) will execute and deliver any and all
termination statements, releases and other documents reasonably requested
by Borrower evidencing the release and termination of such security
interest and lien.
7.2 GUARANTY. Borrower's obligations under this Credit Agreement, the
Notes, and all other Loan Documents shall be guaranteed (a) by Pilgrim
Interests, Ltd., a Texas limited partnership ("PILGRIM LTD") through the
execution of a guarantee, or an amendment to the guaranty provided by
Pilgrim Ltd in connection with the 1999 Credit Agreement, in either case in
form and substance acceptable to the Administrative Agent and delivered on
the Closing Date ("PILGRIM GUARANTY"), and (b) by Acquisition Corp. through
the execution of a guarantee in a form satisfactory to the Administrative
Agent in its reasonable discretion ("ACQUISITION GUARANTY").
7.3 GUARANTOR'S COLLATERAL. As security for the payment and
performance of all obligations of Acquisition Corp. to the Administrative
Agent and to all present and future Syndication Parties under the
Acquisition Guaranty, Survivor and the Subsidiary Merger Survivor, as
applicable, shall grant to, and maintain for, the Administrative Agent, for
the benefit of all present and future Syndication Parties, a first lien and
security interest, pursuant to the Security Documents in the following
("XXXXXXX COLLATERAL") in accordance with the timing set forth in Section
10.3 hereof: (a) all of Survivor's stock in Xxxxxxx, and all rights,
including the rights to distributions, thereunder ("XXXXXXX SECURITIES
COLLATERAL"); (b) all of Survivor's and Subsidiary Merger Survivor's real
property interest, furniture, fixtures and equipment located at, or used in
connection with, the poultry hatching, raising, slaughtering, processing,
packaging, and shipping operations and facilities identified on Part A of
EXHIBIT 7.3 hereto ("WLR CHICKEN ASSETS"); (c) all of Survivor's and
Subsidiary Merger Survivor's real property interest, furniture, fixtures
and equipment located at, or used in connection with, the turkey hatching,
raising, slaughtering, processing, packaging, and shipping operations and
facilities identified on Part B of EXHIBIT 7.3 hereto ("WLR TURKEY
ASSETS"); and (d) all proceeds with respect to the assets described in
clauses (a), (b), and (c) above and all insurance policies in connection
with the assets described in clauses (a), (b), (c), and (d) hereof and the
proceeds thereof, in each case whether now owned or hereafter acquired.
Survivor and Subsidiary Merger Survivor, as applicable shall execute and
deliver to the Administrative Agent, for the benefit of the Syndication
Parties, the Xxxxxxx Security Documents to evidence the security interest
of the Administrative Agent, for the benefit of the Syndication Parties, in
the Xxxxxxx Collateral, together with such financing statements or other
documents as the Administrative Agent shall reasonably request. Survivor
and Subsidiary Merger Survivor, as applicable, shall also execute such
further security agreements, mortgages, deeds of trust, financing
statements, assignments or other documents as the Administrative Agent
shall reasonably request from time to time, in form and substance as the
Administrative Agent shall specify, to establish, confirm, perfect or
provide notice of the Administrative Agent's security interest (for the
benefit of the Administrative Agent and all Syndication Parties) in the
Xxxxxxx Collateral. Upon complete satisfaction of each of the requirements
of Subsections 10.3.3 and 10.3.4 hereof, the Administrative Agent (i) will
be deemed to have released and terminated any lien and security interest in
the Xxxxxxx Securities Collateral, (ii) will deliver to Borrower any and
all certificates in the Administrative Agent's possession representing the
Xxxxxxx Securities Collateral, and (iii) will execute and deliver any and
all termination statements, releases and other documents reasonably
requested by Borrower evidencing the release and termination of such
security interest and lien.
Article 8. REPRESENTATIONS AND WARRANTIES
To induce the Syndication Parties to make the Loans and recognizing
that the Syndication Parties and the Administrative Agent are relying
thereon, Borrower represents and warrants as follows:
8.1 ORGANIZATION, GOOD STANDING, ETC. Borrower: (a) is duly
organized, validly existing, and in good standing under the laws of its
state of incorporation; (b) is duly qualified to do business and is in good
standing in the states of Texas and Arkansas and each other jurisdiction in
which the transaction of its business makes such qualification necessary,
except to the extent that the failure to so qualify has not resulted in,
and could not reasonably be expected to cause, a Material Adverse Effect;
and (c) has all requisite corporate and legal power to own and operate its
assets and to carry on its business, and to enter into and perform the Loan
Documents to which it is a party. Each Subsidiary (other than after the
Merger Consummation Date Xxxxxxx Supply Company, Inc.): (x) is duly
organized, validly existing, and in good standing under the laws of its
jurisdiction of organization; (y) is duly qualified to do business and is
in good standing in each jurisdiction in which the transaction of its
business makes such qualification necessary, except to the extent that the
failure to so qualify has not resulted in, and could not reasonably be
expected to cause, a Material Adverse Effect; and (z) has all requisite
corporate and legal power to own and operate its assets and to carry on its
business.
8.2 CORPORATE AUTHORITY, DUE AUTHORIZATION; CONSENTS. Borrower has
taken all corporate action necessary to execute, deliver and perform its
obligations under the Loan Documents to which it is a party. All consents
or approvals of any Person which are necessary for, or are required as a
condition of Borrower's execution, delivery and performance of and under
the Loan Documents, have been obtained except where the failure to obtain
such consent or approval could not reasonably be expected to cause a
Material Adverse Effect.
8.3 LITIGATION. Except as described on EXHIBIT 8.3 hereto, there are
no pending legal or governmental actions, proceedings or investigations to
which Borrower or any Subsidiary is a party or to which any property of
Borrower or any Subsidiary is subject which could reasonably be expected to
result in any Material Adverse Effect and, to Borrower's knowledge, no such
actions or proceedings are threatened or contemplated by any federal,
state, county, or city (or similar unit) governmental agency or any other
Person.
8.4 NO VIOLATIONS. The execution, delivery and performance of the
Loan Documents will not: (a) violate any provision of Borrower's
Organizational Documents, or any law, rule, regulation (including, without
limitation, Regulations T, U, and X of the Board of Governors of the
Federal Reserve System), or any judgment, order or ruling of any court or
governmental agency; (b) violate, require consent under (except such
consent as has been obtained), conflict with, result in a breach of,
constitute a default under, or with the giving of notice or the expiration
of time or both, constitute a default under, any existing real estate
mortgage, indenture, lease, security agreement, contract, note, instrument
or any other agreements or documents binding on Borrower or affecting its
property which, in any such circumstance, could reasonably be expected to
result in any Material Adverse Effect; or (c) violate, conflict with,
result in a breach of, constitute a default under, or result in the loss
of, or restriction of rights under, any Required License or any order, law,
rule, or regulation under or pursuant to which any Required License was
issued or is maintained ("LICENSING LAWS") which, in any such circumstance,
could reasonably be expected to result in any Material Adverse Effect.
8.5 BINDING AGREEMENT. Each of the Loan Documents to which Borrower
is a party is the legal, valid and binding obligation of Borrower,
enforceable in accordance with its terms, subject only to limitations on
enforceability imposed by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting creditors' rights
generally and by general principles of equity.
8.6 COMPLIANCE WITH LAWS. Borrower and each Subsidiary are in
compliance with all federal, state, and local laws, rules, regulations,
ordinances, codes and orders, including without limitation all
Environmental Laws and all Licensing Laws, with respect to which
noncompliance would result in a Material Adverse Effect.
8.7 PRINCIPAL PLACE OF BUSINESS. Borrower's place of business, or
chief executive office if it has more than one place of business, and the
place where the records required by Section 10.1 hereof are kept, is
located at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx 00000.
8.8 PAYMENT OF TAXES. Except as shown on EXHIBIT 8.8 hereto, Borrower
and each Subsidiary have filed all required federal, state and local tax
returns and have paid all taxes as shown on such returns as they have
become due, and have paid when due all other taxes, assessments or
impositions levied or assessed against Borrower or any Subsidiary, or their
business or properties, except for those subject to a Good Faith Contest or
where the failure to make such filing or payment could not reasonably be
expected to result in a Material Adverse Effect. EXHIBIT 8.8 specifically
indicates all such taxes which are subject to a Good Faith Contest as of
the Closing Date.
8.9 LICENSES AND APPROVALS. Borrower and each Subsidiary have
ownership of, or license to use, or have been issued, all trademarks,
patents, copyrights, franchises, certificates, approvals, permits,
authorities, agreements, and licenses which are used or necessary to permit
it to own its properties and to conduct the business as presently being
conducted as to which the termination or revocation thereof could
reasonably be expected to have a Material Adverse Effect ("REQUIRED
LICENSES"). Each Required License is in full force and effect, and there
is no outstanding notice of cancellation or termination or, to Borrower's
knowledge, any threatened cancellation or termination in connection
therewith, nor has an event occurred with respect to any Required License
which, with the giving of notice or passage of time or both, could result
in the revocation or termination thereof or otherwise in any impairment of
Borrower's rights with respect thereto, which impairment could reasonably
be expected to have a Material Adverse Effect. Borrower is not required to
obtain any consent, permission, authorization, order, or license of any
governmental authority, in connection with the execution, delivery,
performance, or enforcement of and under the Loan Documents to which
Borrower is a party except such as have been obtained and are in full force
and effect.
8.10 EMPLOYEE BENEFIT PLANS. Except as otherwise disclosed in writing
to the Administrative Agents and on EXHIBIT 8.10 hereto:
8.10.1 EMPLOYEE BENEFIT PLANS; MULTIEMPLOYER PLANS. EXHIBIT 8.10
hereto sets forth as of the Closing Date a true and complete list of each
Borrower Benefit Plan, Borrower Pension Plan, and Multiemployer Plan that
is maintained by Borrower or in which Borrower participates or to which
Borrower is obligated to contribute, in each case as of the Closing Date.
Borrower has received no written notification that any Multiemployer Plan
to which Borrower currently has any obligation to contribute which is an
"employee pension benefit plan" as such term is defined in Section 3(2) of
ERISA fails to qualify under the Code.
8.10.2 PENSION BENEFIT PLANS. To the knowledge of Borrower, each
Borrower Benefit Plan that is an "employee pension benefit plan" as defined
in Section 3(2) of ERISA that is intended to satisfy the requirements of
Section 401(a) of the Code (each a "BORROWER PENSION PLAN"), and the trust,
if any, forming a part thereof, meets in all material respects, and, in all
material respects, since its inception has met, the requirements for
qualification under Section 401(a) of the Code, and for exemption from
taxation under Section 501(a) of the Code (except that these
representations shall not be deemed to have been made subsequent to the
Closing Date). The Internal Revenue Service ("IRS") has issued a favorable
determination letter with respect to the qualification of each Borrower
Pension Plan as of the Closing Date and the trust, if any, relating
thereto, and, to the knowledge of Borrower, the IRS has not taken any
action to revoke any such letter.
8.10.3 PROHIBITED TRANSACTIONS. With respect to each Borrower
Benefit Plan sponsored or maintained by Borrower or in which Borrower
participates or to which Borrower is obligated to contribute (with the
exception of any Multiemployer Plan), neither Borrower nor any Borrower
Benefit Plan or, to the knowledge of Borrower, a fiduciary thereof, is
engaged or has engaged in any transaction which is prohibited by Part 4 of
Subtitle B of Title I of ERISA or which might subject any such plan or
related trust, or any trustee or administrator thereof, to a tax or penalty
imposed by Section 4975 of the Code or Section 502(i) of ERISA or to
liability under Section 409 of ERISA, any of which would have a Material
Adverse Effect. With respect to each Multiemployer Plan to which Borrower
or a member of Borrower's "controlled group" (as that term is defined in
Section 414(b) or (c) of the Code) has any obligation to contribute, to the
knowledge of Borrower, neither Borrower nor any Multiemployer Plan or a
fiduciary thereof is engaged or has engaged in any transaction which is
prohibited by Part 4 of Subtitle B of Title I of ERISA or which might
subject Borrower to a tax or penalty imposed by Section 4975 of the Code or
Section 502(i) of ERISA or to liability under Section 409 of ERISA, any of
which would have a Material Adverse Effect.
8.10.4 CIVIL/CRIMINAL ACTION. To the knowledge of Borrower, no
civil or criminal action brought pursuant to Part 5 of Subtitle B of
Title I of ERISA is pending, or, to the knowledge of Borrower, is
threatened against Borrower, any Borrower Benefit Plan or any fiduciary
thereof with respect to any Borrower Benefit Plan (except that these
representations shall not be deemed to have been made subsequent to the
Closing Date).
8.10.5 FUNDING. (a) Each Borrower Pension Plan is in compliance
with the minimum funding standards of Section 412 of the Code and Part 3 of
Subtitle B of Title I of ERISA, and (b) no waivers of the minimum funding
standards have been requested, and no Borrower Pension Plan has any
"accumulated funding deficiency" within the meaning of Section 412 of the
Code.
8.10.6 COMPLIANCE WITH LAW. To the knowledge of Borrower,
Borrower is in compliance in all material respects with, and each Borrower
Benefit Plan has been operated in all material respects in accordance with,
the provisions of such plan and in compliance in all material respects
with, ERISA, the Code and all other applicable law governing each such
Borrower Benefit Plan, including but not limited to rules and regulations
promulgated by the Department of Labor, the Pension Benefit Guaranty
Corporation, and the Department of the Treasury pursuant to the provisions
of ERISA and the Code, including without limitation, the bonding
requirements of Section 412 of ERISA and the disclosure and reporting
requirements of Part 1 of Subtitle B of Title I of ERISA, except to the
extent any such failure would not have a Material Adverse Effect (except
that these representations shall not be deemed to have been made subsequent
to the Closing Date).
8.10.7 MULTIPLE EMPLOYER PLAN. As of the Closing Date, Borrower
does not participate in any "multiple employer plan" within the meaning of
Section 413 of the Code.
8.10.8 PLAN TERMINATION LIABILITY; MULTIEMPLOYER PLAN WITHDRAWAL
LIABILITY. (a) Borrower has not incurred any material liability under
Title IV of ERISA arising in connection with the termination of, or
complete or partial withdrawal from, any employee pension benefit plan (as
defined in Section 3(2) of ERISA), covered or previously covered by
Title IV of ERISA, which liability, or any portion thereof, will constitute
a liability of Borrower at or after the Closing Date except to the extent
that any such liability would not have a Material Adverse Effect, and
(b) neither Borrower nor any member of Borrower's "controlled group" as
defined in Code Section 414(b), (c), (m), or (o) prior to the Closing Date
has incurred any liability under Title IV of ERISA arising in connection
with the complete or partial withdrawal from any Multiemployer Plan, which
liability, or any portion thereof, will constitute a liability of Borrower
at or after the Closing Date, except to the extent that any such liability
would not have a Material Adverse Effect.
8.10.9 PENSION PLAN TERMINATION. No proceedings to terminate any
Borrower Pension Plan have been instituted under Subtitle C of Title IV of
ERISA.
8.10.10 REPORTABLE EVENT. To the knowledge of Borrower, no
"reportable event" within the meaning of Section 4043 of ERISA and the
regulations thereunder has occurred with respect to any Borrower Pension
Plan (other than a Multiemployer Plan), other than a reportable event for
which notice or penalty for noncompliance has been waived by regulation or
otherwise. With respect to any Multiemployer Plan that is a defined
benefit plan to which Borrower has any obligation to contribute, to the
knowledge of Borrower, no such "reportable event" has occurred which would
materially and adversely affect such plan, and, to the knowledge of
Borrower, no such plan is in reorganization within the meaning of Part 3 of
Subtitle E of Title IV of ERISA (except that the representations contained
in this sentence shall not be deemed to have been made subsequent to the
Closing Date).
8.10.11 PAYMENT OF CONTRIBUTIONS. In respect of each Borrower
Benefit Plan, Borrower has paid or will have paid or accrued as of the
Closing Date (a) all contributions or premiums required to be made by it
for all plan years ending on or prior to the Closing Date and, (b) for the
plan year which includes the Closing Date, any contributions or premiums
required to be made by it by the Closing Date under the terms of the
Borrower Benefit Plan. Except as disclosed in EXHIBIT 8.10, Borrower is
not, as of the Closing Date, obligated to pay any contributions or premiums
to a Multiemployer Plan. Except as set forth in EXHIBIT 8.10 hereto, all
contributions paid or accrued by Borrower on or prior to the Closing Date
in respect of any Borrower Pension Plan that is a defined benefit plan have
been based on the actuarial assumptions and methods used for the last plan
year ended on or before the Closing Date, or if there is no prior plan year
for any such plan, contributions have been based upon reasonable actuarial
assumptions and methods.
8.10.12 WELFARE BENEFIT PLANS. As of the Closing Date, Borrower
does not participate in a "multiple employer welfare arrangement" within
the meaning of Section 3(40) of ERISA. Except as disclosed in EXHIBIT 8.10
hereto, Borrower does not, as of the Closing Date, maintain or contribute
to a "voluntary employees' beneficiary association" within the meaning of
Section 501(c)(9) of the Code or a "welfare benefit fund" within the
meaning of Section 419 of the Code, nor does Borrower maintain or
contribute to any employee welfare benefit plan within the meaning of
Section 3(1) of ERISA for the benefit of retired or former employees (other
than as required by Section 4980B of the Code and Sections 601 through 608
of ERISA ("COBRA") or other applicable law). Borrower has complied in all
material respects with the applicable provisions of COBRA with respect to
the Borrower Benefit Plans.
8.11 EQUITY INVESTMENTS. Borrower does not, as of the Closing Date,
own any stock or other voting or equity interest, directly or indirectly,
in any Person valued at the greater of book value or market value at
$5,000,000 or more, other than as set forth on EXHIBIT 8.11 hereto.
8.12 TITLE TO REAL AND PERSONAL PROPERTY. Borrower and each
Subsidiary (a) have all real and personal property necessary for the
conduct of their respective business, and (b) have good and marketable
title to, or valid leasehold interests in, all of their material properties
and assets, real and personal, including, as of the Closing Date, the
properties and assets and leasehold interests reflected in the financial
statements of the Borrower and its Subsidiaries referred to in Section 8.13
hereof, except (i) any properties or assets disposed of in the ordinary
course of business, (ii) rights of way, easements, and similar interests in
real property or defects in title which in the aggregate could not
reasonably be expected to result in a Material Adverse Effect, and
(iii) Permitted Encumbrances; and none of the properties of Borrower or any
Subsidiary are subject to any Lien, except Permitted Encumbrances. All
such property is in good operating condition and repair, reasonable wear
and tear excepted, and suitable in all material respects for the purposes
for which it is being utilized except where their failure to be in good
operating condition could not reasonably be expected to result in a
Material Adverse Effect. All of the leases of Borrower and each Subsidiary
which constitute Material Agreements are in full force and effect and
afford Borrower or such Subsidiary peaceful and undisturbed possession of
the subject matter thereof.
8.13 FINANCIAL STATEMENTS. The consolidated balance sheets of
Borrower and its Subsidiaries for the Fiscal Quarter ended July 1, 2000,
and the related consolidated statements of operations, cash flows and
consolidated statements of capital shares and equities for the Fiscal
Quarter then ended, and the accompanying footnotes, copies of which have
been furnished to the Administrative Agent and the Syndication Parties,
fairly present in all material respects the consolidated financial
condition of Borrower and its Subsidiaries as at such dates and the results
of the consolidated operations of Borrower and its Subsidiaries for the
periods covered by such statements, all in accordance with GAAP. Between
July 1, 2000 and the Closing Date, there has been no material adverse
change in the financial condition, results of operations, or business of
Borrower or any of its Subsidiaries taken as a whole. As of the Closing
Date, there are no liabilities of Borrower or any of its Subsidiaries,
fixed or contingent, which are material but are not reflected in the
financial statements of Borrower and its Subsidiaries referred to above or
referred to in the notes thereto, other than liabilities arising in the
ordinary course of business since July 1, 2000 or referred to in periodic
filings of Borrower with the Securities and Exchange Commission subsequent
to July 1, 2000 but prior to the Closing Date, copies of which have been
provided to the Administrative Agent by Borrower. No information, exhibit,
or report furnished by Borrower or any of its Subsidiaries to the
Administrative Agent and the Syndication Parties in connection with
Borrower's application for the Facilities and the negotiation of this
Credit Agreement contained any material misstatement of fact or omitted to
state a material fact or any fact necessary to make the statements
contained therein not materially misleading in light of the circumstances
in which they were made and taken together with the other information,
exhibits and reports furnished to the Administrative Agent and the
Syndication Parties.
8.14 ENVIRONMENTAL COMPLIANCE. Except as set forth on EXHIBIT 8.14
hereto, Borrower and each Subsidiary have obtained all permits, licenses
and other authorizations which are required under all applicable
Environmental Laws, except to the extent failure to have any such permit,
license or authorization could not reasonably be expected to result in a
Material Adverse Effect. Except as set forth on EXHIBIT 8.14 hereto,
Borrower and each Subsidiary are in compliance with all Environmental Laws
and the terms and conditions of the required permits, licenses and
authorizations, and are also in compliance with all other limitations,
restrictions, obligations, schedules and timetables contained in those Laws
or contained in any plan, order, decree, judgment, injunction, notice or
demand letter issued, entered, promulgated or approved thereunder, except
to the extent, in each case, failure to comply has not resulted in, and
could not reasonably be expected to result in, a Material Adverse Effect.
8.15 FISCAL YEAR. Each fiscal year of Borrower is a year (a) ending
on the Saturday closest to September 30 in each calendar year, regardless
of whether such Saturday occurs in September or October of any calendar
year and (b) beginning on the day immediately following the end of the
preceding Fiscal Year.
8.16 MATERIAL AGREEMENTS. The periodic reports of Borrower filed with
the Securities and Exchange Commission, copies of which have been provided
to the Administrative Agent by Borrower, and/or EXHIBIT 8.16 hereto list
each Material Agreement of the Borrower and each Subsidiary as of the
Closing Date. Borrower is not in default under any of its Material
Agreements, nor, to Borrower's knowledge, (a) is any other party to any of
Borrower's Material Agreements in default thereunder, or (b) do any facts
exist which with the giving of notice or the passage of time, or both,
would constitute such a default by any party to any of Borrower's Material
Agreement.
8.17 REGULATIONS U AND X. No portion of any Advance will be used for
the purpose of purchasing, carrying, or making loans to finance the
purchase of, any "margin security" or "margin stock" as such terms are used
in Regulations U or X of the Board of Governors of the Federal Reserve
System, 12 C.F.R. Parts 221 and 224.
8.18 TRADEMARKS, TRADENAMES. Borrower and each Subsidiary have
ownership or the lawful right to use all tradenames, trademarks, patents,
and other intellectual property which they utilizes in their business as
presently being conducted and as anticipated to be conducted, except where
the failure to do so could not reasonably be expected to result in a
Material Adverse Effect.
8.19 NO DEFAULT ON OUTSTANDING JUDGMENTS OR ORDERS. Borrower and each
Subsidiary have satisfied all final and non-appealable judgments and
Borrower and each Subsidiary are not in default with respect to any
judgment, writ, injunction, decree, rule or regulation of any court,
arbitrator or federal, state, municipal or other Governmental Authority,
commission, board, bureau, agency or instrumentality, domestic or foreign,
except to the extent such failure to satisfy any or all such final and non-
appealable judgments or to be in such a default has not resulted in, and
could not reasonably be expected to result in, a Material Adverse Effect.
8.20 NO DEFAULT IN OTHER AGREEMENTS. Neither Borrower nor any
Subsidiary is in default in any respect in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in
any agreement or instrument where such failure to perform, observe or
fulfill has resulted in, or could reasonably be expected to result in, a
Material Adverse Effect.
8.21 LABOR MATTERS; LABOR AGREEMENTS. Except as set forth in
EXHIBIT 8.21 hereof: (a) As of the Closing Date, there are no collective
bargaining agreements or other labor agreements covering any employees of
Borrower or any Subsidiary the termination, cessation, or breach of which
could reasonably be expected to result in a Material Adverse Effect, and a
true and correct copy of each such agreement will be furnished to the
Administrative Agent upon its written request from time to time. (b) There
is no organizing activity involving Borrower or any Subsidiary pending or,
to Borrower's knowledge, threatened by any labor union or group of
employees. (c) There are, to Borrower's knowledge, no representation
proceedings pending or threatened with the National Labor Relations Board,
and no labor organization or group of employees of Borrower or any
Subsidiary has made a pending demand for recognition. (d) There are no
complaints or charges against Borrower or any Subsidiary pending or, to
Borrower's knowledge threatened to be filed with any federal, state, local
or foreign court, governmental agency or arbitrator based on, arising out
of, in connection with, or otherwise relating to the employment or
termination of employment by Borrower or any Subsidiary of any individual.
(e) There are no strikes or other labor disputes against Borrower or any
Subsidiary that are pending or, to Borrower's knowledge, threatened.
(f) Hours worked by and payment made to employees of Borrower or any
Subsidiary have not been in violation of the Fair Labor Standards Act (29
U.S.C. section 201 et seq.) or any other applicable law dealing with such
matters. The representations made in subparagraphs (b) through (f) of this
Section are made with respect to those occurrences described which could,
considered in the aggregate, reasonably be expected to have a Material
Adverse Effect.
8.22 GOVERNMENTAL REGULATION. Neither Borrower nor any Subsidiary is
subject to regulation under the Public Utility Holding Company Act of 1935,
the Investment Company Act of 1940, the Interstate Commerce Act, the
Federal Power Act or any statute or regulation, in each case, limiting its
ability to incur indebtedness for money borrowed as contemplated hereby.
8.23 CONFIDENTIAL INFORMATION MEMORANDUM. To the best of Borrower's
knowledge, the information contained in, and all attachments to, the
Confidential Information Memorandum dated October 2000 provided by Borrower
to the Administrative Agent and to the Syndication Parties was as of such
date, and is as of the Closing Date, accurate, true, correct, and complete
in all material respects, and not misleading in any material respect.
8.24 FINANCIAL PROJECTIONS. The Financial Projections provided to the
Administrative Agent and the Syndication Parties with respect to Borrower
and its Subsidiaries fairly present, as of the Effective Date, in all
material respects the projected operations, financial condition, assets and
liabilities as of the dates covered thereby. To Borrower's knowledge, no
undisclosed facts existed at the time of submission of the Financial
Projections which, if taken into account, would have resulted in any
material change in any of the Financial Projections. The Financial
Projections were, at the time of submission, based upon reasonable
estimates and assumptions, all of which were fair in light of then-current
conditions, were prepared on the basis of the assumptions stated therein,
and reflected the reasonable estimate of Borrower of the results of
operations and other information projected therein. Nothing in this
Section shall be deemed to constitute an assurance by Borrower that it will
meet the results contained in the Financial Projections.
8.25 SOLVENCY. After giving effect to the consummation of each Loan
to be made under this Agreement as of the time this representation is
given, Borrower (a) will be able to pay its debts as they become due,
(b) will have funds and capital sufficient to carry on its business and all
businesses in which it is about to engage, and (c) will own property in the
aggregate having a value both at fair valuation and at fair saleable value
in the ordinary course of Borrower's business greater than the amount
required to pay its Debt, including for this purpose unliquidated,
contingent, and disputed claims.
8.26 SURVIVOR STOCK; WLR CHICKEN AND TURKEY ASSETS; AND ACQUISITION
STOCK. (a) Prior to the Merger Consummation Date, the Acquisition Stock
shall constitute 100% of all of the issued and outstanding common and
preferred stock of Acquisition Corp.; (b) upon and after the Merger
Consummation Date, the Survivor Stock shall constitute 100% of all of the
issued and outstanding common and preferred stock of Survivor; (c) after
giving effect to the Merger, Borrower will have good title and ownership
rights to all of the Survivor Stock, free and clear of any liens, charges,
and other encumbrances other than Permitted Encumbrances; (d) after giving
effect to the Merger and the Subsidiary Merger, Subsidiary Merger Survivor
will have good title and ownership rights to all of the WLR Chicken Assets
and all of the WLR Turkey Assets, free and clear of any liens, charges, and
other encumbrances other than Permitted Encumbrances; and (e) before the
Merger, Borrower will have good title and ownership rights to all of the
issued and outstanding stock of Acquisition Corp., free and clear of any
liens, charges, and other encumbrances other than Permitted Encumbrances,
after the Merger, Borrower will have good title and ownership rights to all
of the issued and outstanding stock of Survivor, free and clear of any
liens, charges, and other encumbrances other than Permitted Encumbrances,
and after the Subsidiary Merger, Borrower will have good title and
ownership rights to all of the issued and outstanding stock of Subsidiary
Merger Survivor, free and clear of any liens, charges, and other
encumbrances other than Permitted Encumbrances.
8.27 XXXXXXX SUBSIDIARY ASSETS. To the best of Borrower's knowledge
based upon the due diligence it has performed in connection with the
Acquisition Agreement and the transactions to be consummated thereunder,
the fair value of the assets owned by the Xxxxxxx Subsidiaries other than
Xxxxxxx does not exceed $5,000,000.00 in the aggregate as of the Closing
Date and will not exceed such amount as of the Merger Consummation Date.
8.28 DISCLOSURE. The representations and warranties contained in this
Article 8 and in the other Loan Documents and in any financial statements
provided to the Administrative Agent do not contain any untrue statement of
a material fact or omit to state a material fact necessary to make such
representations or warranties not misleading; and all projections provided
to the Administrative Agent were prepared in good faith based on reasonable
assumptions.
Article 9. CONDITIONS TO ADVANCES
9.1 CONDITIONS TO CLOSING. The obligation of the Syndication Parties
to make the initial Advance hereunder is subject to satisfaction, in the
sole discretion of the Administrative Agent and the Syndication Parties, of
each of the following conditions precedent:
9.1.1 LOAN AND AMENDMENT DOCUMENTS; POSSESSION OF COLLATERAL; AND
PILGRIM GUARANTY. The Administrative Agent shall have received: (a) duly
executed originals of the Amendment Documents, the Borrower Pledge
Agreement, and other Loan Documents; (b) possession of the Acquisition
Stock (including executed stock powers with respect thereto) and such other
instruments and documents in which the Administrative Agent, on behalf of
the Syndication Parties, has been granted a security interest and of which
the Administrative Agent is to have possession under the terms of the Loan
Documents; and (c) the Pilgrim Guaranty duly executed by Pilgrim Ltd.
9.1.2 APPROVALS. The Administrative Agent shall have received
evidence satisfactory to it that all consents and approvals of governmental
authorities and third parties which are with respect to (a) Borrower
necessary for, or required as a condition of the validity and
enforceability of, the Loan Documents to which it is a party, and (b)
Acquisition Corp., necessary for, or required as a condition of the
validity and enforceability of, the Acquisition Guaranty.
9.1.3 ORGANIZATIONAL DOCUMENTS. The Administrative Agent shall
have received: (a) good standing certificate (or comparable), dated no
more than thirty (30) days prior to the Closing Date, for Borrower for its
state of incorporation and the states of Arkansas and Texas; (b) a copy of
the certificate of incorporation of Borrower certified by the Secretary of
State of its state of organization; (c) a copy of the bylaws of Borrower,
certified as true and complete by the Secretary or Assistant Secretary of
Borrower; and (d) a copy of the certificate of incorporation of Acquisition
Corp. certified by the Secretary of State of its state of organization and
a good standing certificate (or comparable), dated no more than thirty
(30) days prior to the Closing Date, for Acquisition Corp. for its state of
incorporation.
9.1.4 EVIDENCE OF INSURANCE. Borrower shall have provided the
Administrative Agent with insurance certificates and such other evidence,
in form and substance satisfactory to the Administrative Agent, of all
insurance required to be maintained by it under the Loan Documents.
9.1.5 TITLE INSURANCE; SURVEY. Borrower shall have provided to
the Administrative Agent (a) in connection with all real property included
in the Collateral in which Borrower has a fee interest, (i) a mortgagees'
title insurance policy (Standard Texas Mortgagees Policy Form with respect
to real property located in the state of Texas, and Standard ALTA form with
respect to real property located in states other than Texas) ("TITLE
POLICY") from an insurer acceptable to the Administrative Agent ("TITLE
INSURER") insuring the lien in favor of the Administrative Agent, on behalf
of the Syndication Parties, as a first priority lien on each such parcel of
real property, subject only to Permitted Encumbrances, and (A) in such
amount as the Administrative Agent shall require, (B) deleting the standard
printed exceptions (including exceptions for mechanics liens and, with
respect to those properties for which a survey is to be provided as set
forth on EXHIBIT 9.1.5 attached hereto, exceptions based on lack of
adequate survey) and the gap exception, (C) containing only such exceptions
to title as are reasonably acceptable to the Administrative Agent,
(D) providing access coverage, and (E) containing such other endorsements
as the Administrative Agent may reasonably require (but in any event
including the following endorsements: revolving credit), and (ii) surveys
on the properties described on EXHIBIT 9.1.5 attached hereto, which
surveys, the certifications thereon, and all information contained therein,
shall be acceptable to the Administrative Agent, and shall contain a legal
description and, except as specifically provided otherwise on
EXHIBIT 9.1.5, shall, at a minimum, show the location of all structures,
visible utilities, fences, xxxxxx, or walls on the parcel and within 5 feet
of all boundaries thereof, any conflicting boundary evidence or visible
encroachments, and all easements, underground utilities, and tunnels for
which properly recorded evidence is available; and (b) in connection with
any lease where Borrower is a lessee of an interest in real property
included in the Collateral and calling for a rental payment equal to or in
excess of $100,000.00 per annum, a Title Policy and a leasehold assignment
and lessor consent in form and content satisfactory to the Administrative
Agent and containing such estoppels of lessor as the Administrative Agent
shall specify.
9.1.6 APPOINTMENT OF AGENT FOR SERVICE - BORROWER AND ACQUISITION
CORP.. The Administrative Agent shall have received evidence satisfactory
to the Administrative Agent that Borrower and Acquisition Corp. have
appointed a Person with offices in Denver, Colorado and otherwise
reasonably acceptable to the Administrative Agent to serve as its agent for
service of process, and that said Person has accepted such appointment by
Borrower and by Acquisition Corp..
9.1.7 NO MATERIAL CHANGE. No change shall have occurred in the
condition or operations of Borrower or any Subsidiary since October 2, 1999
which, when considered in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.
9.1.8 FEES AND EXPENSES. Borrower shall have paid the
Administrative Agent, by wire transfer of immediately available federal
funds all fees set forth in the Fee Letter between CoBank and Borrower
dated September 26, 2000 ("FEE LETTER") and the Mandate Letter between
CoBank, FCSA, and Borrower dated September 26, 2000 and Summary of Terms
and Conditions attached thereto (collectively "COMMITMENT LETTER"), and any
other fees owing to the Administrative Agent which are due on the Closing
Date, and all expenses owing as of the Closing Date pursuant to Section
15.1 hereof and for which Borrower has received an invoice.
9.1.9 EVIDENCE OF CORPORATE ACTION - BORROWER AND ACQUISITION
CORP.. The Administrative Agent shall have received in form and substance
satisfactory to the Administrative Agent: (a) documents, certified to be
true and correct by the Secretary or Assistant Secretary of Borrower,
evidencing all corporate action taken by Borrower (i) to authorize
(including the specific names and titles of the persons authorized to so
act (each an "AUTHORIZED OFFICER")) the execution, delivery and performance
of the Amendment Documents to which it is a party, and (ii) to authorize
the execution of, and performance of its obligations under, the Acquisition
Agreement; and a certificate of the Secretary or Assistant Secretary of
Borrower, dated the Closing Date, certifying the names and true signatures
of the Authorized Officers; and (b) documents, certified to be true and
correct by the Secretary or Assistant Secretary of Acquisition Corp.,
evidencing all corporate action taken by Acquisition Corp. to authorize
(including the specific names and titles of the persons authorized to so
act) the execution, delivery and performance of the Acquisition Guaranty.
9.1.10 OPINION OF COUNSEL. Borrower shall have provided a
favorable opinion of its counsel addressed to the Administrative Agent and
each of the present and future Syndication Parties, covering such matters
as the Administrative Agent may reasonably require, including, without
limitation, due incorporation, authorization and execution, enforceability,
usury, no impairment as to the creation and perfection of real and personal
property liens on the Collateral in relevant jurisdiction, fees, taxes and
qualification requirements. In addition, Borrower shall have provided a
favorable opinion of counsel for Acquisition Corp. addressed to the
Administrative Agent and each of the present and future Syndication
Parties, covering such matters with respect to Acquisition Corp. and the
Acquisition Guaranty as the Administrative Agent may reasonably require,
including, without limitation, due formation, authorization and execution,
enforceability, fees, taxes and qualifications requirements.
9.1.11 ACQUISITION GUARANTY. Acquisition Corp. shall have
executed and delivered to the Administrative Agent the Acquisition
Guaranty.
9.1.12 ACQUISITION AGREEMENT. Borrower shall have delivered to
the Administrative Agent a copy of the Acquisition Agreement as executed,
including all exhibits, schedules, and any amendments thereto.
9.1.13 MATERIAL AGREEMENTS. Borrower shall have provided to the
Administrative Agent all agreements of Acquisition Corp., the termination
or breach of which, based upon Borrower's knowledge as of the Effective
Date, would have a Material Adverse Effect.
9.1.14 FURTHER ASSURANCES. Borrower shall have provided and/or
executed and delivered to the Administrative Agent such further
assignments, documents or financing statements, in form and substance
satisfactory to the Administrative Agent, that Borrower or Acquistion Corp.
is to execute and/or deliver pursuant to the terms of the Loan Documents or
the Acquisition Guaranty or as the Administrative Agent may reasonably
request.
9.2 BORROWING NOTICE; FUNDING NOTICE. Borrower shall give the
Administrative Agent prior written notice by facsimile (effective upon
receipt) of each request for an Advance (a) in the case of a Base Rate
Loan, on or before 11:00 A.M. (Central time) on the day of making such Base
Rate Loan, and (b) in the case of a LIBO Rate Loan, on or before 11:00 A.M.
(Central time) at least three (3) Banking Days prior to the date of making
such LIBO Rate Loan. Each notice must be in substantially the form of
EXHIBIT 9.2 hereto ("BORROWING NOTICE") and must specify (c) the amount of
such Advance, (d) the proposed date of making such Advance, (e) whether
Borrower requests that the Advance will bear interest at (i) the Base Rate
or (ii) the LIBO Rate, and (f) in the case of a LIBO Rate Loan, the initial
LIBO Rate Period applicable thereto. All Advances shall be allocated
between the 7 Year Revolving Loan and the 10 Year Revolving Loan a pro rata
basis so that (g) the portion of each Advance allocated to the 7 Year
Revolving Loan shall be determined by multiplying the Advance amount by a
fraction the numerator of which is the Aggregate 7 Year Commitment then in
effect and the denominator of which is the Aggregate Commitment then in
effect, and (h) the portion of each Advance allocated to the 10 Year
Revolving Loan shall be determined by multiplying the Advance amount by a
fraction the numerator of which is the Aggregate 10 Year Commitment then in
effect and the denominator of which is the Aggregate Commitment then in
effect. The Administrative Agent shall, on or before 12:00 noon (Central
time) of the same Banking Day, notify each Syndication Party ("FUNDING
NOTICE") of its receipt of each such Borrowing Notice and the amount of
such Syndication Party's Funding Share thereunder. Not later than 2:00
P.M. (Central time) on the date of an Advance, each Syndication Party will
make available to the Administrative Agent at the Administrative Agent's
Office, in immediately available funds, such Syndication Party's Funding
Share of such Advance. After the Administrative Agent's receipt of such
funds, but not later than 3:00 P.M. (Central time), and upon fulfillment of
the applicable conditions set forth in Article 9 hereof, the Administrative
Agent will make such Advance available to Borrower, in immediately
available funds, and will transmit such funds by wire transfer to
Borrower's Account.
9.3 CONDITIONS TO ADVANCE. The Syndication Parties' obligation to
fund each Advance is subject to (a) receipt of a properly completed
Borrowing Notice, and (b) the satisfaction, in the sole discretion of the
Administrative Agent and the Syndication Parties, of each of the following
conditions precedent, in addition to those set forth in Sections 9.1 and
9.2 hereof, and each request by Borrower for an Advance shall constitute a
representation by Borrower, upon which the Administrative Agent and
Syndication Parties may rely, that the conditions set forth in this Section
have been satisfied and that the amount of the Advance does not exceed the
limits set forth in Sections 2.1, 2.2, 3.1, and 3.2 hereof, as applicable:
9.3.1 DEFAULT. As of the Advance Date no Event of Default or
Potential Default shall have occurred and be continuing, and the disbursing
of the amount of the Advance requested shall not result in an Event of
Default or Potential Default.
9.3.2 AVAILABILITY PERIOD. The Borrowing Notice does not specify
an Advance Date which is later than the last Banking Day of the
Availability Period.
9.3.3 REPRESENTATIONS AND WARRANTIES; FEES AND EXPENSES. The
representations and warranties of Borrower herein shall be true and correct
in all material respects on and as of the date on which the Advance is to
be made as though made on such date. Borrower shall have paid the
Administrative Agent, by wire transfer of immediately available U.S. funds
all fees set forth in Section 4.5 hereof and in the Fee Letter and the
Commitment Letter, in each case executed by CoBank and Borrower, which are
then due and payable, including all expenses owing as of the Advance Date
pursuant to Section 15.1 hereof for which Borrower has received an invoice.
9.3.4 NO MATERIAL CHANGE. No change shall have occurred in the
condition or operations of Borrower or any Subsidiary since the date of the
financial statements (quarterly or annual, as applicable) most recently
provided by Borrower to the Administrative Agent pursuant to Subsection
10.2.1 or 10.2.2 hereof, as applicable, (or the comparable provisions of
the 1999 Credit Agreement) which, when considered in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.
9.4 CONDITIONS TO ADVANCE TO FUNDING CONCERNING MERGER, OR SUBSIDIARY
MERGER. In addition to the requirements of Sections 9.1, 9.2, and 9.3
hereof, the obligation of the Syndication Parties (a) to make an Advance
with respect to, or to fund, the Merger and/or the Subsidiary Merger, or
(b) to make an Advance (i) under the 7 Year Revolving Loan which, when
added to the aggregate Individual Outstanding 7 Year Obligations of all
Syndication Parties, would exceed $60,000,000.00, or (ii) under the 10 Year
Revolving Loan which, when added to the aggregate Individual Outstanding 10
Year Obligations of all Syndication Parties, would exceed $140,000,000.00
(collectively or individually any such Advance under (a) or (b), a "MERGER
ADVANCE") is, in the case of (a) and/or (b), subject to satisfaction, in
the sole discretion of the Administrative Agent and the Syndication
Parties, of each of the following conditions precedent either before or
contemporaneously with the Merger Advance:
9.4.1 EVIDENCE OF INSURANCE. Borrower shall have provided the
Administrative Agent with insurance certificates and such other evidence,
in form and substance satisfactory to the Administrative Agent, of
insurance concerning the Xxxxxxx Collateral in the form and amounts
required to be maintained under Section 10.8 hereof.
9.4.2 APPOINTMENT OF AGENT FOR SERVICE. The Administrative Agent
shall have received evidence satisfactory to the Administrative Agent that
has appointed a Person with offices in Denver, Colorado and otherwise
reasonably acceptable to the Administrative Agent to serve as its agent for
service of process, and that said Person has accepted such appointment by
Survivor.
9.4.3 EVIDENCE OF CORPORATE ACTION. The Administrative Agent
shall have received in form and substance satisfactory to the
Administrative Agent, documents, certified to be true and correct by the
Secretary or Assistant Secretary of Survivor, evidencing all corporate
action taken by Survivor (a) to authorize (including the specific names and
titles of the persons authorized to so act the execution, delivery and
performance of the Xxxxxxx Security Documents, and (b) to authorize the
execution of, and performance of its obligations under, Survivor Pledge
Agreement; and a certificate of the Secretary or Assistant Secretary of
Survivor, dated the date of the Borrowing Notice requesting the initial
Merger Advance, certifying the names and true signatures of such authorized
officers.
9.4.4 OPINION OF COUNSEL. Borrower shall have provided a
favorable opinion of Survivor's counsel addressed to the Administrative
Agent and each of the present and future Syndication Parties in the form of
EXHIBIT 9.4.4 hereto, with respect to the due authorization, consummation,
and effect, under applicable law, of the Merger and such matters as the
Administrative Agent may reasonably require.
9.4.5 REPRESENTATIONS AND WARRANTIES. The representations and
warranties contained in Sections 8.3, 8.6, 8.8, 8.9, 8.10, 8.12, 8.14,
8.18, 8.19, 8.20, 8.21, 8.22, and 8.23 hereof with respect to Subsidiaries,
shall be true and correct with respect to Survivor and the Xxxxxxx
Subsidiaries (after, with respect to all such Persons, giving effect to the
Merger) as of the date of the initial Merger Advance.
9.4.6 MERGER CONSIDERATION. Borrower shall have provided to the
Administrative Agent a certificate from the chief financial officer of
Acquisition Corp. stating that the cash consideration paid by Acquisition
Corp. to effect the Merger, and anticipated to be paid to effect the
Subsidiary Merger (including the cash payments on account of the WLR Stock,
the purchase, or cash out upon cancellation or exercise, of options,
warrants, and other equity interests in WLR, and the discharge of the
indebtedness for borrowed money of WLR, Xxxxxxx, and the Xxxxxxx
Subsidiaries) is in excess of $275,000,000.00.
9.4.7 COMPLIANCE CERTIFICATE. Borrower shall have provided to
the Administrative Agent the Compliance Certificate required pursuant to
Subsection 4.6.2(b) hereof reporting the Leverage Ratio as of, and after
giving effect to, the Merger, as required by Subsection 4.6.1 hereof.
9.4.8 SOLVENCY CERTIFICATE AND PRO FORMA FINANCIAL STATEMENTS.
Borrower shall have provided to the Administrative Agent: (a) a certificate
executed by Survivor's chief financial officer on behalf of Survivor
stating that after giving effect to the consummation of the Merger and the
contingent liability represented by the Acquisition Guaranty, Survivor
(i) will be able to pay its debts as they become due, (ii) will have funds
and capital sufficient to carry on its business and all businesses in which
it is about to engage, and (iii) will own property in the aggregate having
a value both at fair valuation and at fair saleable value in the ordinary
course of Survivor's business greater than the amount required to pay its
Debt, including for this purpose unliquidated and contingent claims,
including under the Acquisition Guaranty, and including disputed claims;
(b) financial statements supporting the certification described in clause
(a) above, which shall be certified to by Survivor's chief financial
officer on behalf of Survivor, and shall include the following: (i) a pro
forma balance sheet for Survivor, giving effect to the Merger, the
Subsidiary Merger, and the Acquisition Guaranty, setting forth the fair
salable value of Survivor's assets and (ii) a 12 month pro forma cash flow
projection for Survivor, giving effect to the Merger and the Subsidiary
Merger and with respect to which Survivor's chief financial officer on
behalf of Survivor shall certify that such projections are based on
reasonable assumptions; and (c) a certificate executed by Survivor's chief
financial officer on behalf of Survivor stating that in entering into the
Acquisition Guaranty, the Merger, and the Subsidiary Merger, it is not the
intent of Acquisition Corp. to hinder, delay or defraud creditors of
Xxxxxxx or Survivor.
9.4.9 FURTHER ASSURANCES. Borrower shall have provided and/or
executed and delivered to the Administrative Agent such further
assignments, documents or financing statements, in form and substance
satisfactory to the Administrative Agent, that Survivor and/or Borrower is
to execute and/or deliver pursuant to the terms of the Loan Documents or as
the Administrative Agent may reasonably request.
9.5 SPECIAL PROVISIONS RELATIVE TO MERGER AND SUBSIDIARY MERGER.
Notwithstanding any provisions in this Credit Agreement to the contrary,
including specifically, but without limitation, any provisions contained in
Sections 9.1, 9.3, and 9.4 hereof, Borrower shall not be entitled to
request, nor shall any Syndication Party be obligated to make, any Advance
for the purpose of funding the Merger or the Subsidiary Merger subsequent
to February 28, 2001.
9.6 LIMITATION ON LIBO RATE LOANS. Anything herein to the contrary
notwithstanding, if, on or prior to the determination of the LIBO Rate for
any LIBO Rate Period:
(a) The Administrative Agent determines (which
determination shall be conclusive) that quotations of interest rates in the
definition of LIBO Rate are not being provided in the relevant amounts or
for the relevant maturities for purposes of determining rates of interest
for LIBO Rate Loans as provided in this Credit Agreement; or
(b) any Syndication Party determines (which determination
shall be conclusive) that the relevant rates of interest referred to in the
definition of LIBO Rate upon the basis of which the rate of interest for
LIBO Rate Loans for such LIBO Rate Period is to be determined do not
adequately cover the cost to the Syndication Parties of making or
maintaining such LIBO Rate Loans for such LIBO Rate Period;
then the Administrative Agent shall give Borrower prompt notice thereof,
and so long as such condition remains in effect, in the case of clause
(a) above, the Syndication Parties, and in the case of clause (b) above,
the Syndication Party that makes the determination, shall be under no
obligation to make LIBO Rate Loans, convert Base Rate Loans into LIBO Rate
Loans, or continue LIBO Rate Loans, and Borrower shall, on the last
day(s) of the then current applicable LIBO Rate Period(s) for the
outstanding LIBO Rate Loans, either prepay such LIBO Rate Loans or convert
such LIBO Rate Loans into a Base Rate Loan in accordance with Section 4.1
hereof. In addition to the foregoing, in the event a determination is made
under clause (b) above, Borrower shall have the right, but not the
obligation, upon written notice to the Administrative Agent, on or before
10:00 A.M. (Central time) on or before ten (10) Banking Days following
receipt of notice from the Administrative Agent of such condition, to
reduce the Individual 7 Year Commitment and Individual 10 Year Commitment
of such Syndication Party to zero upon making a prepayment, to be treated
as a Voluntary Payment to the extent not inconsistent with the provisions
of this Section, equal to the amount of such Syndication Party's Individual
Outstanding 7 Year Obligations and Individual Outstanding 10 Year
Obligations plus any Funding Losses attributed to the portion of such
payment applied to LIBO Rate Loans as provided below. In the event
Borrower makes such an election, then a reduction in a dollar amount
corresponding to such reduction in Individual 7 Year Commitment and/or
Individual 10 Year Commitment shall be made to the Aggregate 7 Year
Commitment and/or Aggregate 10 Year Commitment, as applicable, and,
notwithstanding any provisions of this Credit Agreement to the contrary,
including, without limitation, Sections 2.8 and 3.8: (i) the amount of
such prepayment shall be applied to outstanding LIBO Rate Loans to the
extent of such Syndication Party's Pro Rata Share thereof and, along with
the amount paid on account of such Funding Losses, distributed to the
Syndication Party making such determination and as to which Borrower has
made such election, and (ii) any reduction in the Aggregate 7 Year
Commitment on account of the provisions of this Section shall not require
or result in a reduction in the Aggregate 10 year Commitment, and any
reduction in the Aggregate 10 Year Commitment on account of the provisions
of this Section shall not require or result in a reduction in the Aggregate
7 year Commitment.
9.7 ILLEGALITY OF LOAN. Notwithstanding any other provision of this
Credit Agreement, in the event that it becomes unlawful for any Syndication
Party or its Applicable Lending Office to honor its obligation to make or
maintain LIBO Rate Loans hereunder or convert Base Rate Loans into LIBO
Rate Loans, then such Syndication Party shall promptly notify the
Administrative Agent and Borrower thereof and such Syndication Party's
obligation to make or continue, or to convert Base Rate Loans into, LIBO
Rate Loans shall be suspended until such time as such Syndication Party may
again make and maintain LIBO Rate Loans (in which case the provisions of
Section 9.6 hereof shall be applicable) and, unless and until Borrower
exercises the rights granted in the next sentence, such Syndication Party's
Individual 7 Year Pro Rata Share or Individual 10 Year Pro Rata Share, as
applicable, of all Loans and all subsequent Advances shall be made as Base
Rate Loans (and such Syndication Party's share of interest payments shall
reflect the foregoing), in each case, until such time as such Syndication
Party may again make and maintain LIBO Rate Loans (in which case the
provisions of Section 9.6 hereof shall be applicable). In the event a such
a notification is made, Borrower shall have the right, but not the
obligation, upon written notice to the Administrative Agent, on or before
10:00 A.M. (Central time) on or before ten (10) Banking Days following
receipt of notice from such Syndication Party, to reduce the Individual 7
Year Commitment and Individual 10 Year Commitment of such Syndication Party
to zero upon making a prepayment, to be treated as a Voluntary Payment to
the extent not inconsistent with the provisions of this Section, equal to
the amount of such Syndication Party's Individual Outstanding 7 Year
Obligations and Individual Outstanding 10 Year Obligations plus any Funding
Losses attributed to the portion of such payment applied to LIBO Rate Loans
as provided below. In the event Borrower makes such an election, then a
reduction in a dollar amount corresponding to such reduction in Individual
7 Year Commitment and/or Individual 10 Year Commitment shall be made to the
Aggregate 7 Year Commitment and/or Aggregate 10 Year Commitment, as
applicable, and, notwithstanding any provisions of this Credit Agreement to
the contrary, including, without limitation, Sections 2.8 and 3.8: (a) the
amount of such prepayment shall be applied to outstanding LIBO Rate Loans
to the extent of such Syndication Party's Pro Rata Share thereof and, along
with the amount paid on account of such Funding Losses, distributed to the
Syndication Party making such determination and as to which Borrower has
made such election, and (b) any reduction in the Aggregate 7 Year
Commitment on account of the provisions of this Section shall not require
or result in a reduction in the Aggregate 10 year Commitment, and any
reduction in the Aggregate 10 Year Commitment on account of the provisions
of this Section shall not require or result in a reduction in the Aggregate
7 year Commitment.
9.8 TREATMENT OF AFFECTED LOANS. If the obligations of any
Syndication Party to make or continue LIBO Rate Loans, or to convert Base
Rate Loans into LIBO Rate Loans, are suspended pursuant to Section 9.5 or
9.6 hereof (all LIBO Rate Loans so affected being herein called "Affected
Loans"), such Syndication Party's Affected Loans shall be automatically
converted into Base Rate Loans on the last day(s) of the then current LIBO
Rate Period(s) for the Affected Loans (or, in the case of a conversion
required by Section 9.5 or 9.6, on such earlier date as such Syndication
Party may specify to Borrower). To the extent that such Syndication
Party's Affected Loans have been so converted, all payments and prepayments
of principal which would otherwise be applied to such Syndication Party's
Affected Loans shall be applied instead to its Base Rate Loans. All
Advances which would otherwise be made or continued by such Syndication
Party as LIBO Rate Loans shall be made or continued instead as Base Rate
Loans, and all Base Rate Loans of such Syndication Party which would
otherwise be converted into LIBO Rate Loans shall remain as Base Rate
Loans.
Article 10. AFFIRMATIVE COVENANTS
From and after the date of this Credit Agreement and until the Bank
Debt is indefeasibly paid in full and the Syndication Parties have no
obligation to make any Advance, Borrower agrees that it will observe and
comply with the following covenants for the benefit of the Administrative
Agent and Syndication Parties:
10.1 BOOKS AND RECORDS. Borrower shall at all times keep, and cause
each Subsidiary to keep, proper books of record and account, in which
correct and complete entries shall be made of all its dealings, in
accordance with GAAP.
10.2 REPORTS AND NOTICES. Borrower shall provide to the
Administrative Agent the following reports, information and notices:
10.2.1 ANNUAL FINANCIAL STATEMENTS. As soon as available, but in
no event later than ninety (90) days after the end of any Fiscal Year of
Borrower occurring during the term hereof one copy of the audit report for
such year and accompanying consolidated financial statements (including all
footnotes thereto), including a consolidated balance sheet, a consolidated
statement of earnings, a consolidated statement of capital, and a
consolidated statement of cash flow for the Borrower and its Subsidiaries,
showing in comparative form the figures for the previous Fiscal Year, all
in reasonable detail, prepared in conformance with GAAP consistently
applied and certified without qualification by Ernst & Young, LLP, or other
independent public accountants of nationally recognized standing selected
by the Borrower and reasonably satisfactory to the Administrative Agent,
and to be accompanied by a copy of any management letter of such
accountants addressed to and received by the board of directors of Borrower
related to such annual audit and annual financial statements. Such annual
financial statements required pursuant to this Subsection shall be
accompanied by a Compliance Certificate signed by Borrower's Chief
Financial Officer.
10.2.2 QUARTERLY FINANCIAL STATEMENTS. As soon as available but
in no event more than forty-five (45) days after the end of each Fiscal
Quarter (excluding the last Fiscal Quarter of Borrower's Fiscal Year) the
following financial statements or other information concerning the
operations of Borrower and its Subsidiaries for such Fiscal Quarter, the
Fiscal Year to date, and for the corresponding periods of the preceding
Fiscal Year, all prepared in accordance with GAAP consistently applied:
(a) a consolidated balance sheet, (b) a consolidated summary of earnings,
(c) a consolidated statement of cash flows, and (d) such other statements
as the Administrative Agent may reasonably request. Such quarterly
financial statements required pursuant to this Subsection shall be
accompanied by a Compliance Certificate signed by Borrower's Chief
Financial Officer or other officer of Borrower acceptable to the
Administrative Agent (subject to normal year end adjustments).
10.2.3 NOTICE OF DEFAULT. As soon as the existence of any Event
of Default or Potential Default becomes known to any officer of Borrower,
prompt written notice of such Event of Default or Potential Default, the
nature and status thereof, and the action being taken or proposed to be
taken with respect thereto.
10.2.4 ERISA REPORTS. As soon as possible and in any event
within twenty (20) days after Borrower or any Subsidiary knows or has
reason to know that any Reportable Event or Prohibited Transaction has
occurred with respect to any Plan or that the Pension Benefit Guaranty
Corporation or Borrower or any Subsidiary has instituted or will institute
proceedings under Title IV of ERISA to terminate any Plan, or that
Borrower, any Subsidiary or any ERISA Affiliate has completely or partially
withdrawn from a Multiemployer Plan, or that a Plan which is a
Multiemployer Plan is in reorganization (within the meaning of Section 4241
of ERISA), is insolvent (within the meaning of Section 4245 of ERISA) or is
terminating, a certificate of the Chief Financial Officer of Borrower or
such Subsidiary setting forth details as to such Reportable Event or
Prohibited Transaction or Plan termination or withdrawal or reorganization
or insolvency and the action Borrower or such Subsidiary proposes to take
with respect thereto, provided, however, that notwithstanding the
foregoing, no reporting is required under this Subsection unless the
matter(s), individually or in the aggregate, result, or could be reasonably
expected to result, in aggregate obligations or liabilities of Borrower
and/or the Subsidiaries in excess of five million dollars ($5,000,000).
10.2.5 NOTICE OF LITIGATION. Promptly after the commencement
thereof, notice of all actions, suits, arbitration and any other
proceedings before any Governmental Authority, affecting Borrower or any
Subsidiary which, if determined adversely to Borrower or any Subsidiary,
could reasonably be expected to require Borrower or any Subsidiary to have
to pay or deliver assets having a value of five million dollars
($5,000,000) or more (whether or not the claim is covered by insurance) or
could reasonably be expected to result in a Material Adverse Effect.
10.2.6 NOTICE OF MATERIAL ADVERSE EFFECT. Promptly after
Borrower obtains knowledge thereof, notice of any matter which, alone or
when considered together with other matters, has resulted or could
reasonably be expected to result in, a Material Adverse Effect.
10.2.7 NOTICE OF ENVIRONMENTAL PROCEEDINGS. Without limiting the
provisions of Subsection 10.2.5 hereof, promptly after Borrower's receipt
thereof, notice of the receipt of all pleadings, orders, complaints,
indictments, or other communication alleging a condition that may require
Borrower or any Subsidiary to undertake or to contribute to a cleanup or
other response under Environmental Regulations, or which seeks penalties,
damages, injunctive relief, or criminal sanctions related to alleged
violations of such laws, or which claims personal injury or property damage
to any person as a result of environmental factors or conditions or which,
if adversely determined, could reasonably be expected to have a Material
Adverse Effect.
10.2.8 REGULATORY AND OTHER NOTICES. Promptly after Borrower's
receipt thereof, copies of any notices or other communications received
from any Governmental Authority with respect to any matter or proceeding
the effect of which could reasonably be expected to have a Material Adverse
Effect.
10.2.9 ADVERSE ACTION REGARDING REQUIRED LICENSES. As soon as
Borrower learns that any petition, action, investigation, notice of
violation or apparent liability, notice of forfeiture, order to show cause,
complaint or proceeding is pending, or, to the best of Borrower's
knowledge, threatened, to seek to revoke, cancel, suspend, modify, or limit
any of the Required Licenses, prompt written notice thereof and Borrower
shall contest any such action in a Good Faith Contest.
10.2.10 NOTICE OF CERTAIN CHANGES. Borrower shall: (a) notify
the Administrative Agent at least ten (10) Banking Days prior to the
occurrence of any change in the name or business form of Borrower; and
(b) take all actions necessary or reasonably requested by Agent in order to
maintain the perfected status of the first lien and security interest of
Agent and the Syndication Parties (subject only to Permitted
Encumbrances) in the Collateral.
10.2.11 AVAILABLE AMOUNT REPORTS. If any Advance is made during
any Fiscal Quarter, then, no later than forty-five (45) days after the end
of such Fiscal Quarter, unless the outstanding principal balance owing
under the Facilities on any Advance Date (including the Advance requested
for such date in a Borrowing Notice) exceeds ninety percent (90%) of the
Aggregate Commitment, in which case an Available Amount Report effective as
of the date of such Borrowing Notice must accompany the Borrowing Notice
(the appropriate date in either case being the "AVAILABLE AMOUNT REPORT
DEADLINE"), a report in the form of EXHIBIT 10.2.11 attached hereto
("AVAILABLE AMOUNT REPORT") effective as of the last day of such Fiscal
Quarter or the date of such Borrowing Notice, as applicable. Any time
that, in connection with a Pari Passu Loan, Borrower requests the
Administrative Agent to execute an Intercreditor Agreement, Borrower shall
provide to the Administrative Agent an endorsement to the Title Policy
increasing the amount of insurance provided thereby (or a new Title Policy
in the full amount, including any such increase) if the following two
conditions have occurred: (a) the maximum amount available under such Pari
Passu Loan, together with the maximum amounts available under all Pari
Passu Loans entered into since the most recent increase in the amount of
the Title Policy, is equal to or greater than $25,000,000.00, and
(b) Borrower has since the most recent increase in the amount of the Title
Policy, provided to the Administrative Agent one or more Available Amount
Reports which, in the aggregate, reflect an increase in the Appraised Value
of the real estate (including any structures or other improvements thereon,
other than equipment) included in the Collateral in an amount equal to or
greater than $25,000,000.00; provided that Borrower shall not be required
to provide such endorsement or new Title Policy on account of Available
Amount Reports which increase the Available Amount based solely on the WLR
Chicken Assets and/or the WLR Turkey Assets so long as (i) no part of the
WLR Chicken Assets or the WLR Turkey Assets are used in calculating whether
a Pari Passu Loan is permitted under this Subsection and (ii) none of the
WLR Chicken Assets or the WLR Turkey Assets are used as security for any
such Pari Passu Loan. In the event an increase in the amount of insurance
available under the Title Policy is required pursuant to the preceding
sentence, the amount of such increase shall be the amount of the aggregate
increase in Appraised Value determined as provided in clause (b) thereof;
provided that in no event shall Borrower be required to increase the amount
of insurance provided under the Title Policy to the extent it would result
in the amount thereof being an amount in excess of (x) during the
Availability Period, the Aggregate Commitment, or (y) at any time after the
end of the Availability Period, the amount of Bank Debt owing. In the
event the parcel or parcels of real estate with respect to which there has
been an increase in Appraised Value are insured by separate Title Policies,
the increase in insured amount required above need only be provided with
respect to those Title Policies.
10.2.12 APPRAISALS. Borrower shall provide the Administrative
Agent with Appraisals: (a) covering all real property interests (fee and
leasehold) required to be included within the Borrower Collateral (other
than the Acquisition Stock and the Survivor Stock): (i) on each two year
anniversary of the Original Effective Date, provided that if the Leverage
Ratio for the Fiscal Quarter immediately preceding (or ending on) such date
is less than fifty percent (50%), this requirement will be deferred on a
Fiscal Quarter basis so long as such ratio is maintained, provided further
that, unless otherwise agreed by the Required Lenders, any such deferrals
shall be for no more than 24 months, so that in any event an Appraisal will
be required no later than four years after the date the last previous
Appraisal was required; and (ii) as may be required in connection with Pari
Passu Loans as provided herein; and (b) covering all real property
interests (fee and leasehold) required to be included within the Xxxxxxx
Collateral (other than the Xxxxxxx Securities Collateral): (i) on the date
which is 182 days after the Merger Consummation Date with respect to the
WLR Chicken Assets, (ii) on the date which is 548 days after the Merger
Consummation Date with respect to the WLR Turkey Assets, (iii) on each two
year anniversary of the Closing Date, provided that if the Leverage Ratio
for the Fiscal Quarter immediately preceding (or ending on) such date is
less than fifty percent (50%), this requirement will be deferred on a
Fiscal Quarter basis so long as such ratio is maintained, provided further
that, unless otherwise agreed by the Required Lenders, any such deferrals
shall be for no more than 24 months, so that in any event an Appraisal will
be required no later than four years after the date the last previous
Appraisal was required; and (iv) as may be required in connection with Pari
Passu Loans as provided herein.
10.2.13 FILINGS AND REPORTS. Promptly upon their becoming
available, copies of all registration statements and regular periodic
reports, if any, which Borrower shall have filed with the Securities and
Exchange Commission or any governmental agency substituted therefor, or any
national securities exchange, including copies of Borrower's form 10-K
annual report, form 10-Q quarterly report and any Form 8-K report filed
with the Securities and Exchange Commission.
10.2.14 ADDITIONAL INFORMATION. With reasonable promptness, such
other information respecting the condition or operations, financial or
otherwise, of Borrower or any Subsidiary as any Syndication Party may from
time to time reasonably request.
10.3 GRANT OF LIENS ON WLR RELATED ASSETS. Borrower shall cause
Acquisition Corp. and/or Survivor, and/or Subsidiary Merger Survivor to,
grant to the Administrative Agent, for the benefit of the Syndication
Parties, a first priority lien on the Xxxxxxx Securities Collateral, the
WLR Chicken Assets, and the WLR Turkey Assets and with respect to such
assets take the actions in accordance with the following time table:
10.3.1 SURVIVOR STOCK. With respect to the Survivor Stock,
Borrower shall as soon as practical after the Merger Consummation Date,
deliver to the Administrative Agent the Survivor Stock (including stock
powers with respect thereto).
10.3.2 XXXXXXX SECURITIES COLLATERAL. With respect to the
Xxxxxxx Securities Collateral, Borrower shall, within five (5) Banking Days
after the Merger Consummation Date, deliver to the Administrative Agent the
Survivor Pledge Agreement duly executed by Survivor and the Xxxxxxx
Securities Collateral (including stock powers with respect thereto), and
evidence satisfactory to the Administrative Agent that all consents and
approvals of governmental authorities and third parties have been obtained
which are with respect to Survivor, necessary for, or required as a
condition of the validity and enforceability of the Survivor Pledge
Agreement.
10.3.3 WLR CHICKEN ASSETS. With respect to the WLR Chicken
Assets, each of the following actions must be completed as soon as
practical after the Merger Consummation Date:
(a) The Administrative Agent shall have received (i)
executed originals of the Xxxxxxx Security Documents pertaining to the WLR
Chicken Assets, and (ii) possession of such instruments and documents in
which the Administrative Agent, on behalf of the Syndication Parties, has
been granted a security interest and of which the Administrative Agent is
to have possession under the terms of such Xxxxxxx Security Documents.
(b) Borrower shall have provided to the Administrative
Agent (a) in connection with all real property included in the Xxxxxxx
Collateral which consists of WLR Chicken Assets and in which Borrower has a
fee interest, (i) a mortgagees' Title Policy from a Title Insurer
acceptable to the Administrative Agent insuring the lien in favor of the
Administrative Agent, on behalf of the Syndication Parties, as a first
priority lien on each such parcel of real property, subject only to
Permitted Encumbrances, and (A) in such amount as the Administrative Agent
shall require, (B) deleting the standard printed exceptions (including
exceptions for mechanics liens and exceptions based on lack of adequate
survey) and the gap exception, (C) containing only such exceptions to title
as are reasonably acceptable to the Administrative Agent, (D) providing
access coverage, and (E) containing such other endorsements as the
Administrative Agent may reasonably require (but in any event including the
following endorsements: revolving credit), and (ii) surveys which,
including the certifications thereon, and all information contained
therein, shall be acceptable to the Administrative Agent, and shall contain
a legal description and shall, at a minimum, show the location of all
structures, visible utilities, fences, xxxxxx, or walls on the parcel and
within 5 feet of all boundaries thereof, any conflicting boundary evidence
or visible encroachments, and all easements, underground utilities, and
tunnels for which properly recorded evidence is available; and (b) in
connection with any lease where Borrower is a lessee of an interest in real
property included in the Collateral and calling for a rental payment equal
to or in excess of $100,000.00 per annum, a Title Policy and a leasehold
assignment and lessor consent in form and content satisfactory to the
Administrative Agent and containing such estoppels of lessor as the
Administrative Agent shall specify.
(c) Borrower shall have (i) provided to the Administrative
Agent Phase I environmental reports, satisfactory in form and content to
the Administrative Agent, on all parcels of real property which are
included within the WLR Chicken Assets, and (ii) obtained such Phase II
environmental reports or taken such remedial or other action as the
Administrative Agent may reasonably require based on the contents of such
environmental reports.
(d) The Administrative Agent shall have received searches
of appropriate filing offices showing that: (a) no state or federal tax
liens have been filed which remain in effect against Survivor, Subsidiary
Merger Survivor, WLR, or Xxxxxxx; (b) except with respect to Permitted
Encumbrances no financing statements have been filed by any Person against
the Xxxxxxx Collateral that consists of the WLR Chicken Assets, except to
perfect the security interests required by this Credit Agreement, which
remain in effect against Survivor, Subsidiary Merger Survivor, WLR, or
Xxxxxxx or any of their assets; (c) all financing statements necessary to
perfect the security interests granted to the Administrative Agent, on
behalf of the Syndication Parties, under the Xxxxxxx Security Documents in
the Xxxxxxx Collateral that consists of the WLR Chicken Assets have been
filed or recorded, to the extent such security interests are capable of
being perfected by such filing; and (d) all of the Xxxxxxx Security
Documents relating to the WLR Chicken Assets required to be recorded or
filed to perfect the security interests and liens granted therein shall be
so recorded and filed.
(e) The Administrative Agent shall have received in form
and substance satisfactory to the Administrative Agent: (i) documents,
certified to be true and correct by the Secretary or Assistant Secretary of
Borrower, evidencing all corporate action taken by Survivor and Subsidiary
Merger Survivor to authorize (including the specific names and titles of
the persons authorized to so act the execution, delivery and performance of
the Xxxxxxx Security Documents to which it is a party and which relate to
WLR Turkey Assets, and a certificate of the Secretary or Assistant
Secretary of Borrower, dated the Closing Date, certifying the names and
true signatures of the Authorized Officers; (ii) documents, certified to be
true and correct by the Secretary or Assistant Secretary of Survivor and
Subsidiary Merger Survivor, evidencing all corporate action taken by such
Person to authorize (including the specific names and titles of the
persons authorized to so act) the execution, delivery and performance of
such Xxxxxxx Security Documents, and (iii) evidence satisfactory to it that
all consents and approvals of governmental authorities and third parties
which are with respect to Survivor and/or Subsidiary Merger Survivor
necessary for, or required as a condition of the validity and
enforceability of such Xxxxxxx Security Documents to which it is a party.
(f) Borrower shall have provided a favorable opinion of
counsel for Survivor and Subsidiary Merger Survivor addressed to the
Administrative Agent and each of the present and future Syndication Parties
in the form of EXHIBIT 10.3.3 (F) hereto, covering such matters as the
Administrative Agent may reasonably require, including, without limitation,
authorization and execution, enforceability, usury, creation and perfection
of real and personal property liens on the Xxxxxxx Collateral that consists
of the WLR Chicken Assets in the relevant jurisdictions, fees, taxes, and
qualification requirements.
10.3.4 WLR TURKEY ASSETS. With respect to the WLR Turkey Assets
owned by Subsidiary Merger Survivor on the date which is 548 days after the
Merger Consummation Date, each of the following actions must be completed
no later than the date which is 578 days after the Merger Consummation
Date:
(a) The Administrative Agent shall have received (i)
executed originals of the Xxxxxxx Security Documents pertaining to the WLR
Turkey Assets, and (ii) possession of such instruments and documents in
which the Administrative Agent, on behalf of the Syndication Parties, has
been granted a security interest and of which the Administrative Agent is
to have possession under the terms of such Xxxxxxx Security Documents.
(b) Borrower shall have provided to the Administrative
Agent (a) in connection with all real property included in the Xxxxxxx
Collateral which consists of WLR Turkey Assets and in which Borrower has a
fee interest, (i) a mortgagees' Title Policy from a Title Insurer
acceptable to the Administrative Agent insuring the lien in favor of the
Administrative Agent, on behalf of the Syndication Parties, as a first
priority lien on each such parcel of real property, subject only to
Permitted Encumbrances, and (A) in such amount as the Administrative Agent
shall require, (B) deleting the standard printed exceptions (including
exceptions for mechanics liens and exceptions based on lack of adequate
survey) and the gap exception, (C) containing only such exceptions to title
as are reasonably acceptable to the Administrative Agent, (D) providing
access coverage, and (E) containing such other endorsements as the
Administrative Agent may reasonably require (but in any event including the
following endorsements: revolving credit), and (ii) surveys which,
including the certifications thereon, and all information contained
therein, shall be acceptable to the Administrative Agent, and shall contain
a legal description and shall, at a minimum, show the location of all
structures, visible utilities, fences, xxxxxx, or walls on the parcel and
within 5 feet of all boundaries thereof, any conflicting boundary evidence
or visible encroachments, and all easements, underground utilities, and
tunnels for which properly recorded evidence is available; and (b) in
connection with any lease where Borrower is a lessee of an interest in real
property included in the Collateral and calling for a rental payment equal
to or in excess of $100,000.00 per annum, a Title Policy and a leasehold
assignment and lessor consent in form and content satisfactory to the
Administrative Agent and containing such estoppels of lessor as the
Administrative Agent shall specify.
(c) Borrower shall have (i) provided to the Administrative
Agent Phase I environmental reports, satisfactory in form and content to
the Administrative Agent, on all parcels of real property which are
included within the WLR Turkey Assets, and (ii) obtained such Phase II
environmental reports or taken such remedial or other action as the
Administrative Agent may reasonably require based on the contents of such
environmental reports.
(d) The Administrative Agent shall have received searches
of appropriate filing offices showing that: (a) no state or federal tax
liens have been filed which remain in effect against Survivor, Subsidiary
Merger Survivor, WLR, or Xxxxxxx; (b) except with respect to Permitted
Encumbrances no financing statements have been filed by any Person against
the Xxxxxxx Collateral that consists of the WLR Turkey Assets, except to
perfect the security interests required by this Credit Agreement, which
remain in effect against Survivor, Subsidiary Merger Survivor, WLR, or
Xxxxxxx or any of their assets; (c) all financing statements necessary to
perfect the security interests granted to the Administrative Agent, on
behalf of the Syndication Parties, under the Xxxxxxx Security Documents in
the Xxxxxxx Collateral that consists of the WLR Turkey Assets have been
filed or recorded, to the extent such security interests are capable of
being perfected by such filing; and (d) all of the Xxxxxxx Security
Documents relating to the WLR Turkey Assets required to be recorded or
filed to perfect the security interests and liens granted therein shall be
so recorded and filed.
(e) The Administrative Agent shall have received in form
and substance satisfactory to the Administrative Agent: (i) documents,
certified to be true and correct by the Secretary or Assistant Secretary of
Borrower, evidencing all corporate action taken by Survivor and Subsidiary
Merger Survivor to authorize (including the specific names and titles of
the persons authorized to so act the execution, delivery and performance of
the Xxxxxxx Security Documents to which it is a party and which relate to
WLR Turkey Assets, and a certificate of the Secretary or Assistant
Secretary of Borrower, dated the Closing Date, certifying the names and
true signatures of the Authorized Officers; (ii) documents, certified to be
true and correct by the Secretary or Assistant Secretary of Survivor and
Subsidiary Merger Survivor, evidencing all corporate action taken by such
Person to authorize (including the specific names and titles of the
persons authorized to so act) the execution, delivery and performance of
such Xxxxxxx Security Documents, and (iii) evidence satisfactory to it that
all consents and approvals of governmental authorities and third parties
which are with respect to Survivor and/or Subsidiary Merger Survivor
necessary for, or required as a condition of the validity and
enforceability of such Xxxxxxx Security Documents to which it is a party.
(f) Borrower shall have provided a favorable opinion of
counsel for Survivor and Subsidiary Merger Survivor addressed to the
Administrative Agent and each of the present and future Syndication Parties
in substantially the form of EXHIBIT 10.3.3(F), covering such matters as
the Administrative Agent may reasonably require, including, without
limitation, authorization and execution, enforceability, usury, creation
and perfection of real and personal property liens on the Xxxxxxx
Collateral that consists of the WLR Turkey Assets in the relevant
jurisdictions, fees, taxes, and qualification requirements.
10.4 MAINTENANCE OF EXISTENCE AND QUALIFICATION. Borrower shall
maintain its corporate existence in good standing under the laws of its
state of organization. Borrower shall, and shall cause each Subsidiary to,
qualify and remain qualified as a foreign corporation or other entity in
each jurisdiction in which such qualification is necessary in view of its
business, operations and properties except where the failure to so qualify
has not and could not reasonably be expected to result in a Material
Adverse Effect.
10.5 COMPLIANCE WITH LEGAL REQUIREMENTS AND AGREEMENTS. Borrower
shall, and shall cause each Subsidiary to: (a) comply with all laws, rules,
regulations and orders applicable to Borrower (or such Subsidiary, as
applicable) or its business unless such failure to comply is the subject of
a Good Faith Contest; and (b) comply with all agreements, indentures,
mortgages, and other instruments to which it (or any Subsidiary, as
applicable) is a party or by which it or any of its (or any Subsidiary, or
any of such Subsidiary's, as applicable) property is bound; provided,
however, that the failure of Borrower to comply with this sentence in any
instance not directly involving the Administrative Agent or a Syndication
Party shall not constitute a Potential Default or an Event of Default
unless such failure would have a Material Adverse Effect.
10.6 COMPLIANCE WITH ENVIRONMENTAL LAWS. Without limiting the
provisions of Section 10.5 of this Credit Agreement, Borrower shall, and
shall cause Subsidiary to, comply in all material respects with, and take
all reasonable steps necessary to cause all persons occupying or present on
any properties owned or leased by Borrower (or any Subsidiary, as
applicable) to comply with, all Environmental Regulations, the failure to
comply with which would have a Material Adverse Effect or unless such
failure to comply is the subject of a Good Faith Contest.
10.7 TAXES. Borrower shall cause to be paid, and shall cause each
Subsidiary to pay, when due all taxes, assessments, and other governmental
charges upon it, its income, its sales, its properties (or upon Subsidiary
and its income, sales, and properties, as applicable), and federal and
state taxes withheld from its (or Subsidiary's, as applicable) employees'
earnings, unless (a) the failure to pay such taxes, assessments, or other
governmental charges could not reasonably be expected to result in a
Material Adverse Effect, or (b) such taxes, assessments, or other
governmental charges are the subject of a Good Faith Contest.
10.8 INSURANCE. Borrower shall, and shall cause each Subsidiary to,
maintain insurance coverage by good and responsible insurance underwriters
in such forms and amounts and against such risks and hazards as are
customary for companies engaged in similar businesses and owing and
operating similar properties, provided that Borrower and its Subsidiaries
may self-insure for workmen's compensation, group health risks and their
live chicken inventory in accordance with applicable industry standards.
In any event, Borrower will insure any of the Collateral which is insurable
against loss or damage by fire, theft, burglary, pilferage and loss in
transit. In addition, to the extent that any real property interests which
constitute a part of the Collateral lie within a designated flood plain,
Borrower must provide flood insurance with respect to such real property
interests. All such policies of insurance shall be issued by sound and
reputable insurers accorded a rating of A-XII or better by A.M. Best
Company or A or better by Standard & Poor's Corporation or Xxxxx'x
Investors Service, Inc. All liability policies shall name the
Administrative Agent, for the benefit of the Syndication Parties, as
additional insured as its interests may appear. All such insurance
policies shall be endorsed with a mortgagee's or loss payable clause, as
appropriate, in favor of the Administrative Agent, for the benefit of the
Syndication Parties. Copies of the policy or policies evidencing all
insurance referred to in this Section and receipts for the payment of
premiums thereon or certificates of such insurance satisfactory to the
Administrative Agent shall be delivered to and held by the Administrative
Agent. All such insurance policies shall contain a provision requiring at
least ten (10) days' notice to the Administrative Agent prior to any
cancellation for non-payment of premiums. Borrower shall give the
Administrative Agent satisfactory written evidence of renewal or
substitution of all such policies. Borrower agrees to pay, or cause to be
paid, all premiums on such insurance as they become due, and will not
permit any condition to exist on or with respect to its assets which would
wholly or partially invalidate any insurance thereon. Borrower shall give
immediate written notice to the insurance carrier and the Administrative
Agent of any loss. Borrower hereby authorizes and empowers the
Administrative Agent upon the occurrence and during the continuation of an
Event of Default, at the Administrative Agent's option and in the
Administrative Agent's sole discretion, to, in so far as affects the
Collateral, act as attorney-in-fact for Borrower to make proof of loss, to
adjust and compromise any claim under insurance policies, to collect and
receive insurance proceeds, and to deduct therefrom the Administrative
Agent's expenses incurred in the collection of such proceeds, and all
insurance policies of Borrower shall provide that the Administrative Agent
may act as Borrower's attorney-in-fact for such purposes.
10.9 TITLE TO AND MAINTENANCE OF PROPERTIES. Borrower shall defend
and maintain title to, and shall maintain, keep and preserve, and cause
each Subsidiary to maintain, keep and preserve, all of its material
properties (tangible and intangible) necessary or used in the proper
conduct of its business in good working order and condition, ordinary wear
and tear excepted, and shall cause to be made all repairs, renewals,
replacements, betterments and improvements thereof, all as in the sole
judgment of Borrower or such Subsidiary may be reasonably necessary so that
the business carried on in connection therewith may be properly and
advantageously conducted at all times.
10.10 PAYMENT OF LIABILITIES. Borrower shall pay, and shall cause its
Subsidiaries to pay, all liabilities (including, without limitation:
(a) any indebtedness for borrowed money or for the deferred purchase price
of property or services; (b) any obligations under leases which have or
should have been characterized as Capitalized Leases; and (c) any
contingent liabilities, such as guaranties, for the obligations of others
relating to indebtedness for borrowed money or for the deferred purchase
price of property or services or relating to obligations under leases which
have or should have been characterized as Capitalized Leases) as they
become due beyond any period of grace under the instrument creating such
liabilities, unless (with the exception of the Bank Debt and Pari Passu
Loans) (y) the failure to pay such liabilities within such time period
could not reasonably be expected to result in a Material Adverse Effect, or
(z) they are the subject of a Good Faith Contest.
10.11 INSPECTION. Borrower (a) shall permit, and cause its
Subsidiaries to permit, the Administrative Agent or any Syndication Party
or their agents, during normal business hours or at such other times as the
parties may agree, to examine, and make copies of or abstracts from,
Borrower's properties, books, and records, and to discuss Borrower's
affairs, finances, operations, and accounts with its respective officers,
directors, employees, and independent certified public accountants; and
(b) shall permit the Administrative Agent to obtain periodic verification
of the existence and condition, of the Collateral and Borrower shall
reimburse the Administrative Agent for the reasonable costs incurred in
connection with such verification, provided that so long as no Event of
Default has occurred and is continuing, Borrower shall not be required to
reimburse the Administrative Agent for costs incurred under this clause
(b) with respect to more than one such verification in each Fiscal Year.
10.12 REQUIRED LICENSES; PERMITS; ETC. Borrower shall duly and
lawfully obtain and maintain in full force and effect, and shall cause its
Subsidiaries to obtain and maintain in full force and effect, all Required
Licenses as appropriate for the business being conducted and properties
owned by Borrower or such Subsidiaries at any given time except where the
failure to obtain or maintain such Required Licenses could not reasonably
be expected to result in a Material Adverse Effect.
10.13 ERISA. Borrower shall (a) cause each Borrower Benefit Plan to
comply in all material respects with the Code and ERISA; (b) cause any
Borrower Benefit Plan that is intended to satisfy the requirements of
Section 401(a) of the Code to satisfy such requirements in all material
respects; (c) prepare and deliver each material report, statement or other
document required by ERISA and the Code within the period specified therein
and conforming in form and substance in all material respects to the
provisions thereof; and (d) cause each Borrower Benefit Plan (other than a
Multiemployer Plan) to be administered in all material respects in
accordance with the terms of each such plan and with ERISA, the Code, and
any other applicable law, except to the extent any failure to comply with
the preceding clauses (a), (b) (c), or (d) would not have a Material
Adverse Effect. Within ten (10) Banking Days after receiving such notice,
Borrower shall furnish to Administrative Agent any written notice received
by Borrower relating to an assertion of withdrawal liability imposed by any
Multiemployer Plan upon Borrower or Borrower's controlled group, as defined
in Code Section 414(b), (c), (m), or (o), or relating to any violation of
the provisions of the Code or ERISA asserted by the Department of Labor,
the Pension Benefit Guaranty Corporation or the Department of the Treasury
with respect to any Borrower Benefit Plan that could reasonably be expected
to have a Material Adverse Effect. Borrower shall notify the
Administrative Agent within sixty (60) days after: (l) commencing
participation in any "multiple employer plan" within the meaning of Section
413 of the Code; (m) commencing participation in a "multiple employer
welfare arrangement" within the meaning of Section 3(40) of ERISA; or
(n) establishing or becoming obligated to contribute to any employee
"retiree health plan" within the meaning of Section 3(1) of ERISA for the
benefit of retired or former employees (other than as required by Section
4980B of the Code and Sections 601 through 608 of ERISA ("COBRA") or other
applicable law). Borrower shall notify the Administrative Agent within
sixty (60) days after Borrower has knowledge of the occurrence of any fact
or event which would make any of the representations contained in
Subsections 8.10.2, 8.10.4, 8.10.6, or 8.10.10 hereof incorrect if such
representations were made as of the date of such occurrence with respect to
any Borrower Benefit Plan that is a Multiemployer Plan.
10.14 FINANCIAL COVENANTS. Borrower shall maintain the following
financial covenants, measured on the consolidated results of Borrower and
its Subsidiaries:
10.14.1 LEVERAGE RATIO. A Leverage Ratio of not in excess of the
ratio set forth below at any time during the periods set forth below:
(a) From the Closing Date to the earlier of (i) the date on
which the book value (as in effect immediately preceding the Merger
Consummation Date) of WLR Turkey Assets sold, whether in one transaction or
in a series of transactions over time, reaches an aggregate of
$30,000,000.00, or (ii) the date which is two (2) years after the Merger
Consummation Date: 0.675
(b) Thereafter: 0.625
10.14.2 TANGIBLE NET WORTH. Tangible Net Worth at all times
during the periods from the Closing Date and at all times during each
Fiscal Year thereafter, not less than an amount in any Fiscal Year of
$250,000,000.00 plus an amount equal to (a) 75% of Borrower's Net Income
(but not less than zero) during such Fiscal Year, if Borrower's Leverage
Ratio for such Fiscal Year is equal to or greater than 0.5 to 1.00 or
(b) 50% of Borrower's Net Income (but not less than zero) during such
Fiscal Year if Borrower's Leverage Ratio for such Fiscal Year is less than
0.5 to 1.00.
10.14.3 CURRENT RATIO. A Current Ratio measured as of the last
day of each Fiscal Quarter of not less than 1.35 to 1.00.
10.14.4 NET TANGIBLE ASSETS TO TOTAL LIABILITIES. A ratio of Net
Tangible Assets to Total Liabilities measured as of the last day of each
Fiscal Quarter of not less than 1.30 to 1.00.
10.14.5 FIXED CHARGE COVERAGE RATIO. The Fixed Charge Coverage
Ratio over the most recent eight consecutive Fiscal Quarters, measured as
of the last day of each Fiscal Quarter, of not less than 1.50 to 1.00;
provided that upon the occurrence of the Merger Consummation Date, the
measurement components of this ratio shall include (with respect to the
applicable eight consecutive Fiscal Quarter period) results of operations
of WLR and each Subsidiary of WLR whose accounts are consolidated with
those of WLR in accordance with GAAP.
10.14.6 NET WORKING CAPITAL. Net Working Capital, measured as of
the last day of each Fiscal Quarter during the periods set forth below, of
not less than the amount set forth below for each such period:
(a) During Fiscal Year 2001, $75,000,000.00; and
(b) During each Fiscal Year thereafter, $85,000,000.00.
10.15 APPRAISED PROPERTY. Except as, and solely for the period,
specifically provided otherwise in Section 1.15 hereof with respect to the
WLR Chicken Assets and the WLR Turkey Assets, no Available Amount Report
will be based in any part on the Appraised Value of any real property, or
improvements, fixtures, machinery or equipment located on any real
property, not, in either case, described in the deeds of trust executed, on
or prior to the date of such Available Amount Report, by Borrower in
connection with this Credit Agreement.
10.16 CONSUMMATION OF SUBSIDIARY MERGER. Borrower shall cause
Survivor to consummate the Subsidiary Merger by a date which is no later
than 60 days after the Merger Consummation Date.
10.17 OPINION OF COUNSEL - SUBSIDIARY MERGER. Borrower shall, within
five Banking Days of the consummation of the Subsidiary Merger, provide to
the Administrative Agent the opinion of counsel for Subsidiary Merger
Survivor in substantially the form of EXHIBIT 10.17 hereto, with respect to
the due incorporation, authorization, consummation, and effect, under
applicable law, of the Subsidiary Merger, and regarding other matters
reasonably required by the Administrative Agent.
10.18 TITLE INSURANCE ENDORSEMENTS. As soon as practical following
the Effective Date, but in any event no later than thirty (30) days
following the Effective Date, Borrower shall provide to the Administrative
Agent with respect to each Title Policy provided to the Administrative
Agent in connection with the 1999 Credit Agreement, either (a) new title
policies issued by the Title Insurer which issued such Title Policy
describing the insured Mortgage as the Mortgage as amended by the
appropriate Amendment Document and otherwise in substantially the same form
as the Title Policy provided to the Administrative Agent in connection with
the 1999 Credit Agreement; or (b) an endorsement thereto issued by the
Title Insurer which issued such Title Policy (i) describing the insured
Mortgage as the Mortgage as amended by the appropriate Amendment Document,
and (ii) bringing down the effective date of such Title Policy to the
Closing Date.
10.19 AGENT FOR SERVICE - SUBSIDIARY MERGER SURVIVOR. Borrower shall,
as soon as practical following the Merger Consummation Date, but in any
event no later than five Banking Days thereafter, provide to the
Administrative Agent evidence satisfactory to the Administrative Agent that
Subsidiary Merger Survivor has appointed a Person with offices in Denver,
Colorado and otherwise reasonably acceptable to the Administrative Agent to
serve as its agent for service of process, and that said Person has
accepted such appointment by Subsidiary Merger Survivor.
10.20 DOCUMENTS WITH RESPECT TO MERGER AND SUBSIDIARY MERGER.
Borrower shall: (a) as soon as practical following the Merger Consummation
Date, but in any event no later than five Banking Days thereafter, provide
to the Administrative Agent copies of the following documents, showing
execution by all parties thereto and/or filing or recording information, as
applicable: (i) (A) a good standing certificate (or comparable), dated no
more than thirty (30) days prior to the Advance Date for the initial Merger
Advance, for Survivor for the Commonwealth of Virginia, and the states of
West Virginia, Pennsylvania, and North Carolina, (B) a copy of the
certificate of incorporation of Survivor certified by the Secretary of
State of its state of organization, and (C) a copy of the bylaws of
Survivor, certified as true and complete by its Secretary or Assistant
Secretary; and (ii) Articles of Merger (with respect to the Merger) as
filed with the State Corporation Commission of the Commonwealth of
Virginia; and (b) as soon as practical following the date on which the
Subsidiary Merger is consummated ("SUBSIDIARY MERGER CONSUMMATION DATE"),
but in any event no later than five Banking Days thereafter, provide to the
Administrative Agent copies of the following documents, showing execution
by all parties thereto and/or filing or recording information, as
applicable: (i) (A) a good standing certificate (or comparable), for
Subsidiary Merger Survivor for the Commonwealth of Virginia, and the states
of West Virginia, Pennsylvania, and North Carolina, (B) a copy of the
certificate of incorporation of Subsidiary Merger Survivor certified by the
Secretary of State of its state of organization, and (C) a copy of the
bylaws of Subsidiary Merger Survivor, certified as true and complete by its
Secretary or Assistant Secretary; and (ii) Articles of Merger (with respect
to the Subsidiary Merger) as filed with the State Corporation Commission of
the Commonwealth of Virginia.
10.21 MATERIAL AGREEMENTS. Borrower shall, as soon as practical
following the Merger Consummation Date, but in any event no later than
thirty days thereafter, provide to the Administrative Agent a list
describing all agreements of Survivor, WLR, and Xxxxxxx, the termination or
breach of which, based upon Borrower's knowledge as of the date of such
list, would have a Material Adverse Effect. Subsequent to providing such
list, Borrower shall provide copies of any such agreements as may be
requested by the Administrative Agent.
10.22 EXHIBIT UPDATES . Borrower shall, as soon as practical
following the Merger Consummation Date, but in any event no later than
thirty days thereafter, provide to the Administrative Agent for the
Administrative Agent's review, such proposed updates of the Exhibits
described in Articles 8 and 11 hereof, updated to take into account the
effect of the Merger, as Borrower shall deem necessary. To the extent such
updates are approved by the Administrative Agent, the updated Exhibit shall
replace the corresponding Exhibit attached hereto at the Effective Date.
Article 11. NEGATIVE COVENANTS
From and after the date of this Credit Agreement until the Bank Debt
is indefeasibly paid in full, and the Syndication Parties have no
obligation to make any Advance, Borrower agrees that it will observe and
comply with, and, to the extent applicable, will cause its Subsidiaries to
observe and comply with, the following covenants:
11.1 BORROWING. Borrower shall not (nor shall it permit any of its
Subsidiaries to) create, incur, or assume, directly or indirectly, any
Debt, except for:
(a) indebtedness of Borrower arising under this Credit
Agreement and the other Loan Documents;
(b) trade payables arising in the ordinary course of
business;
(c) Capital Leases in existence from time to time;
(d) current operating liabilities (other than trade
payables or for borrowed money) incurred in the ordinary course of
business;
(e) the Pari Passu Loans;
(f) secured Debt (other than Bank Debt and the Pari Passu
Loans) in an aggregate amount at any time outstanding of up to the sum of
(i) eighty-five percent (85%) of the book value of the outstanding accounts
receivable of Borrower and its Subsidiaries (as such account receivable
would be shown on a consolidated balance sheet of Borrower and its
Subsidiaries prepared in accordance with GAAP), less allowance for doubtful
accounts, PLUS (ii) seventy-five percent (75%) of the higher of book value
or fair market value, determined in accordance with GAAP, of the assets of
Borrower and its Subsidiaries, but excluding from such calculation under
this clause (ii), the assets covered by clause (i), the Collateral
(including, after the Merger Consummation Date, whether or not the
Administrative Agent has, for the benefit of the Syndication Parties, been
granted a lien thereon, the WLR Chicken Assets, and the WLR Turkey Assets),
and good will, MINUS (iii) amounts owing under the Xxxxxx Loan and under
the Xxxxxxx Loan;
(g) unsecured Debt in any amount provided that no more than
$50,000,000.00 of unsecured indebtedness outstanding at any time (but
excluding from such restriction, the Comerica Loan and the 10 7/8
Notes) may provide for scheduled principal payments prior to November 16,
2010, and provided that with respect to individual indebtedness of greater
than $10,000,000.00 incurred after the Closing Date, pro forma covenant
compliance must be established to the Administrative Agent before such
indebtedness is incurred;
(h) loans between Subsidiaries or between Borrower and
Subsidiaries, in each case in the ordinary course and pursuant to the
reasonable requirements of Borrower's business and consistent with
demonstratable past practices; provided that any such loans to Borrower are
expressly subordinated to the prior payment in full in cash of all of
Borrower's indebtedness, obligations and liabilities to the Administrative
Agent and the Syndication Parties under this Credit Agreement and the other
Loan Documents; and
(i) the incurrence by Borrower of Debt to Xxxxxx Trust and
Savings Bank pursuant to the Reimbursement Agreement dated June 15, 1999
between Borrower and Xxxxxx Trust and Savings Bank, or under an irrevocable
letter of credit, surety bond, insurance policy or other similar instrument
issued by any Person to support Borrower's obligations pursuant to that
certain Loan Agreement dated as of June 15, 1999, between Borrower and the
Camp County Industrial Development Corporation or in connection with the
related bonds issued by the Camp County Industrial Development Corporation
(and reimbursement and similar agreements in respect thereof).
11.2 NO OTHER BUSINESSES. Borrower shall not, and shall not permit
its Subsidiaries to, engage in any material respects in any business
activity or operations other than operations or activities (a) in the
poultry industry, (b) in the processing, packaging, distribution, and
wholesale sales of poultry products, or (c) which are not substantially
different from or are related to its present business activities or
operations.
11.3 LIENS. Borrower shall not (nor shall it permit any of its
Subsidiaries to) create, incur, assume or suffer to exist any mortgage,
pledge, lien, charge or other encumbrance on, or any security interest in,
any of its real or personal properties (including, without limitation,
leasehold interests, leasehold improvements and any other interest in real
property or fixtures), now owned or hereafter acquired, except the
following ("PERMITTED ENCUMBRANCES"):
(a) Liens for taxes or assessments or other charges or
levies of any Governmental Authority, that are not delinquent or if
delinquent are the subject of a Good Faith Contest;
(b) Liens imposed by law, such as mechanic's, worker's,
repairman's, miner's, agister's, attorney's, materialmen's, landlord's,
warehousemen's and carrier's Liens and other similar Liens which are
securing obligations incurred in the ordinary course of business for sums
not yet due and payable or, if due and payable, which (i) do not exceed an
aggregate at any one time of $10,000,000.00 or (ii) are the subject of a
Good Faith Contest;
(c) Liens under workers' compensation, unemployment
insurance, social security or similar legislation (other than ERISA), or to
secure payments of premiums for insurance purchased in the ordinary course
of business, or to secure the performance of tenders, statutory
obligations, surety and appearance bonds and bids, bonds for release of an
attachment, stay of execution or injunction, leases, government contracts,
performance and return-of-money bonds and other similar obligations, all of
which are incurred in the ordinary course of business and not in connection
with the borrowing of money;
(d) Any attachment or judgment Lien, the time for appeal or
petition for rehearing of which shall not have expired or in respect of
which Borrower or the Subsidiary is protected in all material respects by
insurance or for the payment of which adequate reserves have been provided,
provided that the execution or other enforcement of such Liens is
effectively stayed and the claims secured thereby are the subject of a Good
Faith Contest, and provided further that the aggregate amount of
liabilities of Borrower and its Subsidiaries so secured (including interest
and penalties) shall not be in excess of $5,000,000 at any one time
outstanding;
(e) Easements, rights-of-way, restrictions, encroachments,
covenants, servitudes, zoning and other similar encumbrances which, in the
aggregate, do not materially interfere with the occupation, use and
enjoyment by Borrower or any Subsidiary of the property or assets
encumbered thereby in the normal course of its business or materially
impair the value of the property subject thereto;
(f) All precautionary filings of financing statements under
the Uniform Commercial Code which cover property that is made available to
or used by Borrower or any Subsidiary pursuant to the terms of an Operating
Lease or Capital Lease;
(g) Liens, other than on the Collateral (including, after
the Merger Consummation Date, whether or not the Administrative Agent has,
for the benefit of the Syndication Parties, been granted a lien thereon,
the Acquisition Stock, the Xxxxxxx Securities Collateral, the WLR Chicken
Assets, and the WLR Turkey Assets), securing its reimbursement obligations
under any letter of credit issued in connection with the acquisition of an
asset; provided that (i) the lien attaches only to such asset, and (ii) the
lien is released upon satisfaction of such reimbursement obligation;
(h) Liens on the Collateral (including, after the Merger
Consummation Date, whether or not the Administrative Agent has, for the
benefit of the Syndication Parties, been granted a lien thereon, the
Acquisition Stock, the Xxxxxxx Securities Collateral, the WLR Chicken
Assets, and the WLR Turkey Assets) in connection with the Bank Debt or any
permitted Pari Passu Loan;
(i) Liens on assets of Borrower or its Subsidiaries, other
than on the Collateral (including, after the Merger Consummation Date,
whether or not the Administrative Agent has, for the benefit of the
Syndication Parties, been granted a lien thereon, the Acquisition Stock,
the Xxxxxxx Securities Collateral, the WLR Chicken Assets, and the WLR
Turkey Assets), to secure indebtedness permitted under Sections 11.1(f) and
11.1(i); and
(j) Liens existing on the Original Effective Date and
described on EXHIBIT 11.3 hereto (as such Exhibit may be approved by the
Administrative Agent).
Reference in this Section to the Xxxxxxx Securities Collateral and the
Acquisition Stock shall be deemed deleted on and after the date when the
Administrative Agent is deemed to have released its lien, for the benefit
of the Syndication Parties, thereon pursuant to the provisions of Sections
7.1 and 7.3 hereof.
11.4 SALE OF ASSETS. Borrower shall not (nor shall it permit any of
its Subsidiaries to) sell, convey, assign, lease or otherwise transfer or
dispose of, voluntarily, by operation of law or otherwise, any of the
Collateral (including, after the Merger Consummation Date, whether or not
the Administrative Agent has, for the benefit of the Syndication Parties,
been granted a lien thereon, the Acquisition Stock, the Xxxxxxx Securities
Collateral, and the WLR Chicken Assets, but specifically excluding the WLR
Turkey Assets) except the sale of assets disposed of in the ordinary course
of business, and which are either replaced or are no longer necessary or
useful for the business conducted at the facilities which are included
within the Collateral (including, whether or not the Administrative Agent
has, for the benefit of the Syndication Parties, been granted a lien
thereon, the Acquisition Stock, the Xxxxxxx Securities Collateral, and the
WLR Chicken Assets, but specifically excluding the WLR Turkey Assets).
Reference in this Section to the Xxxxxxx Securities Collateral and the
Acquisition Stock shall be deemed deleted on and after the date when the
Administrative Agent is deemed to have released its lien, for the benefit
of the Syndication Parties, thereon pursuant to the provisions of Sections
7.1 and 7.3 hereof.
11.5 LIABILITIES OF OTHERS. Borrower shall not (nor shall it permit
any of its Subsidiaries to) assume, guarantee, become liable as a surety,
endorse, contingently agree to purchase, or otherwise be or become liable,
directly or indirectly (including, but not limited to, by means of a
maintenance agreement, or any other agreement designed to ensure any
creditor against loss), for or on account of the obligation of any Person
(other than the Bank Debt), except (a) by the endorsement of negotiable
instruments for deposit or collection or similar transactions in the
ordinary course of the Borrower's or any Subsidiary's business, (b) the
guarantee of the obligations of Borrower's wholly owned Subsidiaries,
(c) guarantees by any Subsidiary of the indebtedness of Borrower under the
New Notes; provided that each such Subsidiary also executes a guaranty
reasonably satisfactory in form and substance to the Administrative Agent
guaranteeing all of Borrower's obligations under this Credit Agreement, the
Notes, and all other Loan Documents; and (d) without duplication of clauses
(b) or (c), guarantees made from time to time by Borrower and its
Subsidiaries in the ordinary course of their respective businesses;
provided, however, that the aggregate amount of all indebtedness guaranteed
at any time under this clause (d) shall not exceed $10,000,000 in the
aggregate.
11.6 LOANS. Borrower shall not (nor shall it permit any of its
Subsidiaries to) lend or advance money, credit, or property to any Person,
except for:
(a) loans between Subsidiaries or between Borrower and
Subsidiaries, in each case in the ordinary course and pursuant to the
reasonable requirements of Borrower's business and consistent with
demonstratable past practices;
(b) trade credit extended in the ordinary course of
business;
(c) LOANS AND ADVANCES TO EMPLOYEES AND CONTRACT GROWERS
(OTHER THAN EXECUTIVE OFFICERS AND DIRECTORS OF THE BORROWER OR ITS
SUBSIDIARIES) FOR REASONABLE EXPENSES INCURRED IN THE ORDINARY COURSE OF
BUSINESS AND MADE ON AN ARMS LENGTH BASIS;
(d) loans and advances to officers and employees of
Borrower and its Subsidiaries made in connection with such officer's or
employee's housing related expenses or loans associated with the
procurement or sale of personal residences or necessary for the moving of
key personnel, in an aggregate amount outstanding at any time not to exceed
$3,000,000.00; and
(e) loans by Borrower to Acquistion Corp. as contemplated
by Sections 2.5 and 3.5 hereof.
11.7 MERGER; ACQUISITIONS; BUSINESS FORM; ETC. Borrower shall not
(nor shall it permit any of its Subsidiaries to) merge or consolidate with
any entity, or acquire all or substantially all of the assets of any person
or entity, nor shall Borrower change its business form from a corporation;
provided, however, that the foregoing shall not prevent the Merger nor any
such acquisition, consolidation, or merger if after giving effect thereto
either clauses (a), (c) and (d) are satisfied or clauses (b), (c), and
(d) are satisfied, as such clauses are set forth below:
(a) Both (i) the fair market value of all consideration
paid or payable (whether paid or payable in money, stock, or some other
form, including, without limitation, by promissory note or some other
installment obligation) by Borrower and/or its Subsidiaries on account of
all such mergers, consolidations or acquisitions does not exceed
$50,000,000.00 in any Fiscal Year of Borrower, and (ii) Borrower (or, if
the consolidation or merger is by a Subsidiary, then the Subsidiary) is the
surviving entity;
(b) The consolidation or merger is between Borrower and a
Subsidiary or subsidiary of a Subsidiary, and Borrower is the surviving
entity, or the consolidation or merger is between a Subsidiary and another
Subsidiary or a Subsidiary and the subsidiary of a Subsidiary, and the
Subsidiary is the surviving entity;
(c) No Event of Default or Potential Default shall have
occurred and be continuing;
(d) After giving effect to the merger or consolidation on a
pro forma basis, there would be no Event of Default or Potential Default.
11.8 INVESTMENTS. Borrower shall not (nor shall it permit any of its
Subsidiaries to) own, purchase or acquire any stock, obligations or
securities of, or any other interest in, or make any capital contribution
to, any Person, except that Borrower and the Subsidiaries may own, purchase
or acquire:
(a) commercial paper maturing not in excess of one year
from the date of acquisition and rated P1 by Xxxxx'x Investors Service,
Inc. or A1 by Standard & Poor's Corporation on the date of acquisition;
(b) certificates of deposit in North American commercial
banks rated C or better by Xxxxx, Xxxxxxxx & Xxxxx, Inc. or 3 or better by
Xxxxx Consulting Analysts, maturing not in excess of one year from the date
of acquisition;
(c) obligations of the United States government or any
agency thereof, the obligations of which are guaranteed by the United
States government, maturing, in each case, not in excess of one year from
the date of acquisition;
(d) repurchase agreements of any bank or trust company
incorporated under the laws of the United States of America or any state
thereof and fully secured by a pledge of obligations issued or fully and
unconditionally guaranteed by the United States government;
(e) Investments permitted under Sections 11.5, 11.6, 11.7,
and 11.9;
(f) Investments made (i) prior to the Original Effective
Date in Persons, which are not Subsidiaries, and (ii) as of the Merger
Consummation Date, by reason of the Merger, in either case as identified on
EXHIBIT 11.8 hereto;
(g) Investments in the Subsidiaries;
(h) acquisition of the Acquisition Stock;
(i) Investments from time to time made after the Merger
Consummation Date in Food Processors Water Cooperative, Inc. and the
Greater Shenandoah Valley Development Company in accordance with past
practice and their respective organizational documents as in effect on the
date hereof; and
(j) Investments not covered by clauses (a) through
(i) above, in an amount not to exceed at any time an aggregate of
$25,000,000.00.
11.9 TRANSACTIONS WITH RELATED PARTIES. Borrower shall not purchase,
acquire, provide, or sell any equipment, other personal property, real
property or services from or to any Subsidiary, except in the ordinary
course and pursuant to the reasonable requirements of Borrower's business
and consistent with demonstratable past practices of the type disclosed in
Borrower's proxy statement for its Fiscal Year ended September 1998;
provided that this Section shall not apply to the Merger or the Subsidiary
Merger.
11.10 DIVIDENDS, ETC. Borrower shall not, directly or indirectly,
declare or pay any dividends (other than dividends payable solely in stock
of Borrower) on account of any shares of any class (including common or
preferred stock) of its capital stock now or hereafter outstanding, or set
aside or otherwise deposit or invest any sums for such purpose, or redeem,
retire, defease, purchase or otherwise acquire any shares of any class of
its capital stock (or set aside or otherwise deposit or invest any sums for
such purpose) for any consideration other than common stock or apply or set
apart any sum, or make any other distribution (by reduction or capital or
otherwise) in respect of any such shares or agree to do any of the
foregoing; provided that if no Potential Default or Event of Default shall
exist before and after giving effect thereto, Borrower may (a) pay
dividends in an aggregate amount not to exceed $3,400,000.00 in any Fiscal
Year; (b) pay dividends permitted under clause (a) hereof during the
immediately preceding Fiscal Year that were declared but not paid in the
immediately preceding Fiscal Year (without giving effect to any carry
over); and (c) repurchase, at any time after the Original Effective Date,
its shares of capital stock in an amount not to exceed $25,000,000.00 in
the aggregate.
11.11 ERISA. Borrower shall not: (a) engage in or permit any
transaction which could result in a "prohibited transaction" (as such term
is defined in Section 406 of ERISA) or in the imposition of an excise tax
pursuant to Section 4975 of the Code; (b) engage in or permit any
transaction or other event which could result in a "reportable event" as
such term is defined in Section 4043 of ERISA for any Borrower Pension
Plan; (c) fail to make full payment when due of all amounts which, under
the provisions of any Borrower Benefit Plan, Borrower is required to pay as
contributions thereto; (d) permit to exist any "accumulated funding
deficiency" (as such term is defined in Section 302 of ERISA) in excess of
$25,000.00, whether or not waived, with respect to any Borrower Pension
Plan; (e) fail to make any payments to any "multiemployer plan" that
Borrower may be required to make under any agreement relating to such
"multiemployer plan" or any law pertaining thereto; or (f) terminate any
Borrower Pension Plan in a manner which could result in the imposition of a
lien on any property of Borrower pursuant to Section 4068 of ERISA.
Borrower shall not terminate any Borrower Pension Plan so as to result in
any liability to the Pension Benefit Guaranty Corporation. As used in this
Section, all terms enclosed in quotation marks shall have the meanings set
forth in ERISA. Borrower's failure to comply with any of the foregoing
provisions of this Section shall not constitute a breach of this Agreement
or an Event of Default unless such failure has a Material Adverse Effect.
11.12 CHANGE IN FISCAL YEAR. Borrower shall not change its Fiscal
Year unless required to do so by the Internal Revenue Service, in which
case Borrower agrees to such amendment of the terms Fiscal Quarter and
Fiscal Year, as used herein, as the Administrative Agent reasonably deems
necessary.
11.13 LEASES. Borrower shall not, and shall not permit any Subsidiary
to, incur non-cancelable obligations on Operating Leases or sale and
leaseback transactions if the aggregate annual amount of all minimum or
guaranteed net rentals payable under such leases would exceed four percent
(4%) of the Net Tangible Assets of Borrower and its Consolidated
Subsidiaries (as determined immediately preceding the execution of such
lease).
11.14 PRINCIPAL PAYMENTS. Borrower shall not make any principal
payments on any subordinated or unsecured debt instruments or related
documents unless and until 105 days have passed since November 16, 2010
without a voluntary or involuntary petition having been filed against
Borrower under the federal bankruptcy laws during that period, other than
(a) payments under debt instruments between and among Borrower and its
Subsidiaries, (b) scheduled payments on its 10 7/8% Senior Subordinated
Notes Due 2003 ("10 7/8% NOTES"), (c) payments on its 10 7/8% Notes with
the proceeds of the issuance of new unsecured notes or subordinated
indebtedness regardless of amount ("NEW NOTES"), (d) prepayments required
on account of asset sales, change of control, or similar events,
(e) repayment of the Comerica Loan, and (f) payments of up to
$50,000,000.00 as permitted by Section 11.1(g) hereof.
Article 12. INDEMNIFICATION
12.1 GENERAL; STAMP TAXES; INTANGIBLES TAX. Borrower agrees to
indemnify and hold the Administrative Agent and each Syndication Party and
their directors, officers, employees, agents, professional advisers and
representatives ("INDEMNIFIED PARTIES") harmless from and against any and
all claims, damages, losses, liabilities, costs or expenses whatsoever
which the Administrative Agent or any other Indemnified Party may incur (or
which may be claimed against any such Indemnified Party by any Person),
including attorneys' fees incurred by any Indemnified Party, arising out of
or resulting from: (a) the material inaccuracy of any representation or
warranty of or with respect to Borrower in this Credit Agreement or the
other Loan Documents; (b) the material failure of Borrower to perform or
comply with any covenant or obligation of Borrower under this Credit
Agreement or the other Loan Documents; or (c) the exercise by the
Administrative Agent of any right or remedy set forth in this Credit
Agreement or the other Loan Documents, provided that Borrower shall have no
obligation to indemnify any Indemnified Party against claims, damages,
losses, liabilities, costs or expenses to the extent that a court of
competent jurisdiction renders a final non-appealable determination that
the foregoing are solely the result of the willful misconduct or gross
negligence of such Indemnified Party. In addition, Borrower agrees to
indemnify and hold the Indemnified Parties harmless from and against any
and all claims, damages, losses, liabilities, costs or expenses whatsoever
which the Administrative Agent or any other Indemnified Party may incur (or
which may be claimed against any such Indemnified Party by any Person),
including attorneys' fees incurred by any Indemnified Party, arising out of
or resulting from the imposition or nonpayment by Borrower of any stamp
tax, intangibles tax, or similar tax imposed by any state, including any
amounts owing by virtue of the assertion that the property valuation used
to calculate any such tax was understated. Borrower shall have the right
to assume the defense of any claim as would give rise to Borrower's
indemnification obligation under this Section with counsel of Borrower's
choosing so long as such defense is being diligently and properly conducted
and Borrower shall establish to the Indemnified Party's satisfaction that
the amount of such claims are not, and will not be, material in comparison
to the liquid and unrestricted assets of Borrower available to respond to
any award which may be granted on account of such claim. So long as the
conditions of the preceding sentence are met, Indemnified Party shall have
no further right to reimbursement of attorneys' fees incurred thereafter.
The obligation to indemnify set forth in this Section shall survive the
termination of this Credit Agreement and other covenants.
12.2 INDEMNIFICATION RELATING TO HAZARDOUS SUBSTANCES. Borrower shall
not, and shall cause the Subsidiaries not to, locate, produce, treat,
transport, incorporate, discharge, emit, release, deposit or dispose of any
Hazardous Substance in, upon, under, over or from any property owned or
held by Borrower or such Subsidiary, except in accordance with all
Environmental Regulations; Borrower shall not, and shall cause the
Subsidiaries not to, permit any Hazardous Substance to be located,
produced, treated, transported, incorporated, discharged, emitted,
released, deposited, disposed of or to escape in, upon, under, over or from
any property owned or held by Borrower or such Subsidiary, except in
accordance with Environmental Regulations; and Borrower shall, and shall
cause each Subsidiary to, comply with all Environmental Regulations which
are applicable to such property except where the failure to comply could
not reasonably be expected to result in a Material Adverse Effect.
Borrower shall indemnify the Indemnified Parties against, and shall
reimburse the Indemnified Parties for, any and all claims, demands,
judgments, penalties, liabilities, costs, damages and expenses, including
court costs and attorneys' fees incurred by the Indemnified Parties (prior
to trial, at trial and on appeal) in any action against or involving the
Indemnified Parties, resulting from any breach of the foregoing covenants
in this Section or the covenants in Section 10.6 hereof, or from the
discovery of any Hazardous Substance in, upon, under or over, or emanating
from, such property, it being the intent of Borrower and the Indemnified
Parties that the Indemnified Parties shall have no liability or
responsibility for damage or injury to human health, the environmental or
natural resources caused by, for abatement and/or clean-up of, or otherwise
with respect to, Hazardous Substances as the result of the Administrative
Agent or any Syndication Party exercising any of its rights or remedies
with respect thereto, including but not limited to becoming the owner
thereof by foreclosure, including foreclosure on a judgment lien, or
conveyance in lieu of foreclosure; provided that such indemnification as it
applies to the exercise by the Administrative Agent or any Syndication
Party of its rights or remedies with respect to the Loan Documents shall
not apply to claims arising solely with respect to Hazardous Substances
brought onto such property by the Administrative Agent or such Syndication
Party while engaged in activities other than operations substantially the
same as the operations previously conducted on such property by Borrower.
The foregoing covenants of this Section shall be deemed continuing
covenants for the benefit of the Indemnified Parties, and any successors
and assigns of the Indemnified Parties, including but not limited to, any
transferee of the title of the Administrative Agent or any Syndication
Party or any subsequent owner of the property, and shall survive the
satisfaction or release of any lien, any foreclosure of any lien and/or any
acquisition of title to the property or any part thereof by the
Administrative Agent or any Syndication Party, or anyone claiming by,
through or under the Administrative Agent or any Syndication Party or
Borrower by deed in lieu of foreclosure or otherwise. Any amounts covered
by the foregoing indemnification shall bear interest from the date incurred
at the Default Interest Rate, shall be payable on demand, and shall be
secured by the Security Documents. The indemnification and covenants of
this Section shall survive the termination of this Credit Agreement and
other covenants.
Article 13. EVENTS OF DEFAULT; RIGHTS AND REMEDIES
13.1 EVENTS OF DEFAULT. The occurrence of any of the following events
(each an "EVENT OF DEFAULT") shall, at the option of the Administrative
Agent, make the entire Bank Debt immediately due and payable (provided,
that in the case of an Event of Default under Subsection 13.1(f) all
amounts owing under the Notes and the other Loan Documents shall
automatically and immediately become due and payable without any action by
or on behalf of the Administrative Agent), and the Administrative Agent may
exercise all rights and remedies for the collection of any amounts
outstanding hereunder and take whatever action it deems necessary to secure
itself, all without notice of default, presentment or demand for payment,
protest or notice of nonpayment or dishonor, or other notices or demands of
any kind or character:
(a) Failure of Borrower to pay (i) when due, whether by
acceleration or otherwise, any principal in accordance with this Credit
Agreement or the other Loan Documents, or (ii) within five (5) Banking Days
of the date when due, whether by acceleration or otherwise, any interest or
amounts other than principal in accordance with this Credit Agreement or
the other Loan Documents.
(b) Any representation or warranty set forth in any Loan
Document, any Borrowing Notice, any financial statements or reports, or in
connection with any transaction contemplated by any such document, shall
prove in any material respect to have been false or misleading when made or
furnished by Borrower.
(c) Any default by Borrower in the performance or
compliance with the covenants, promises, conditions or provisions of
Sections 10.11, 10.15, 10.16, 10.18, 11.1, 11.3, 11.4, 11.5, 11.7, 11.10,
11.13, or 11.14 of this Credit Agreement.
(d) Any default by Borrower in the performance or
compliance with the covenants, promises, conditions or provisions of
Sections 10.2, 10.3, 10.5, 10.6, 10.7, 10.8, 10.9, 10.10, (except as
provided in Section 13.1(f)), 10.12, 10.13, 10.14, 10.17, 10.19, 10.20,
11.6, 11.8, 11.9, 11.11, or 11.12 of this Credit Agreement, and such
failure continues for fifteen (15) days after Borrower learns of such
failure to comply, whether by Borrower's own discovery or through notice
from the Administrative Agent.
(e) The occurrence of an Event of Default under any of the
Security Documents.
(f) The occurrence of an Event of Default under the
Acquisition Guaranty.
(g) Failure of Borrower to comply with any other provision
of this Credit Agreement or the other Loan Documents not constituting an
Event of Default under any of the preceding subparagraphs of this
Section 13.1, and such failure continues for thirty (30) days after
Borrower learns of such failure to comply, whether by Borrower's own
discovery or through notice from the Administrative Agent.
(h) The failure of Borrower to pay when due, or failure to
perform or observe any other obligation or condition with respect to any of
the following obligations to any Person, beyond any period of grace under
the instrument creating such obligation: (i) any indebtedness for borrowed
money or for the deferred purchase price of property or services, (ii) any
obligations under leases which have or should have been characterized as
Capital Leases, or (iii) any contingent liabilities, such as guaranties and
letters of credit, for the obligations of others relating to indebtedness
for borrowed money or for the deferred purchase price of property or
services or relating to obligations under leases which have or should have
been characterized as Capital Leases; provided that no such failure will be
deemed to be an Event of Default hereunder unless the amount owing under
the obligation with respect to which such failures have occurred and are
continuing is at least $10,000,000.00, or unless it is with respect to a
Pari Passu Loan.
(i) Borrower, Guarantor, or any Subsidiary applies for or
consents to the appointment of a trustee or receiver for any part of its
properties; any bankruptcy, reorganization, debt arrangement, dissolution
or liquidation proceeding is commenced or consented to by Borrower,
Guarantor, or any Subsidiary; or any application for appointment of a
receiver or a trustee, or any proceeding for bankruptcy, reorganization,
debt management or liquidation is filed for or commenced against Borrower,
Guarantor, or any Subsidiary, and is not withdrawn or dismissed within
ninety (90) days thereafter; provided that no such consent or filing by or
against a Subsidiary shall constitute an Event of Default under this clause
(g) unless it could reasonably be expected to result in a Material Adverse
Effect.
(j) The entry of one or more judgments in an aggregate
amount in excess of $10,000,000.00 against Borrower not stayed, discharged
or paid within thirty (30) days after entry.
(k) The occurrence at any time from the Original Effective
Date to the Closing Date of any circumstance which would have constituted
an Event of Default under the 1999 Credit Agreement.
(l) In the event (i) Pilgrim, Ltd., Xxxxxx X. "Bo" Pilgrim,
his spouse, his issue, his estate and/or any trust, partnership, or other
entity, primarily for the benefit of his spouse and/or issue shall
(A) cease to own more than fifty percent (50%) of the total voting power
generally entitled to vote in the election of directors, managers or
trustees of Borrower or (B) cease to own more than fifty percent (50%) of
all non-voting classes of capital stock of Borrower, (ii) during any period
of two (2) consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of Borrower (together with any
new directors whose election by such Board of Directors or whose nomination
for election by the stockholders of Borrower was approved by a vote of a
majority of the directors then still in office who were either directors at
the beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute a majority
of the Board of Directors of Borrower then if office, or (iii) the
stockholders of Borrower shall approve any plan for the liquidation or
dissolution of Borrower.
13.2 NO ADVANCE. The Syndication Parties shall have no obligation to
make any Advance if a Potential Default or an Event of Default shall occur
and be continuing.
13.3 RIGHTS AND REMEDIES. In addition to the remedies set forth in
Section 13.1 and 13.2 hereof, upon the occurrence of an Event of Default,
the Administrative Agent shall be entitled to exercise all the rights and
remedies provided in the Loan Documents and by any applicable law. Each
and every right or remedy granted to the Administrative Agent pursuant to
this Credit Agreement and the other Loan Documents, or allowed the
Administrative Agent by law or equity, shall be cumulative. Failure or
delay on the part of the Administrative Agent to exercise any such right or
remedy shall not operate as a waiver thereof. Any single or partial
exercise by the Administrative Agent of any such right or remedy shall not
preclude any future exercise thereof or the exercise of any other right or
remedy.
13.4 AGREEMENT REGARDING, AND WAIVER OF, CERTAIN RIGHTS. Borrower
acknowledges and agrees as follows: (a) no part of the Agricultural Credit
Act of 1987, including, without limitation, those sections thereof
designated as 12 U.S.C. Sections 2199 through 2202e, and the implementing
Farm Credit Administration regulations (collectively "FARM CREDIT
LAW") applies to CoBank or to any Syndication Parties which are commercial
banks, nor to the collection of any funds Advanced by any of them hereunder
and that Borrower will not at any time attempt to assert against CoBank or
any such Syndication Parties any rights or obligations contained in or
arising out of the Farm Credit Law; (b) in the event it is ever determined
that the Farm Credit Law applies to any funds Advanced by FCSA hereunder or
to the collection of any such funds or to the foreclosure on any property
securing any such funds, Borrower hereby waives, and agrees to execute any
document reasonably requested by FCSA and/or the Administrative Agent in
the future to effect such waiver, any rights it may have under any such
Farm Credit Law, including any rights with respect to the acceleration
and/or restructuring of any Bank Debt Advanced by or owed to FCSA hereunder
as to which an Event of Default has occurred and is continuing and any
rights applicable with respect to foreclosure of liens securing any such
Bank Debt; (c) in the event it is ever determined that the Farm Credit Law
applies to any of the Bank Debt described in clause (a) of this Section or
to the collection of any such funds or to the foreclosure of any liens
securing any such funds, Borrower hereby waives any rights it may have
under any such Farm Credit Law, including any rights with respect to the
acceleration and/or restructuring of any such Bank Debt as to which an
Event of Default has occurred and is continuing and any rights applicable
with respect to foreclosure of any liens securing any such Bank Debt; and
(d) in addition to, but not in contradiction of, the waiver set forth in
clause (b) hereof, to the extent any such Farm Credit Law is ever construed
to apply to the acceleration of any Bank Debt described in clause
(b) hereof or to the foreclosure of any liens securing any such funds, or
to give Borrower any rights with respect thereto, Borrower agrees that it
shall not exercise any such rights if the effect thereof would be to
restrict, or in any way delay, the acceleration of, or foreclosure of liens
securing, any of the Bank Debt described in clause (a) of this Section; and
(e) in the event, in connection with the collection of any of the Bank Debt
described in clause (a) of this Section or the foreclosure of any liens
securing any such funds, any one or more of the Syndication Parties
described in clause (a) hereof purchases the Bank Debt described in clause
(b) hereto, Borrower waives and agrees that it shall not exercise any
rights arising under the Farm Credit Laws with respect to the acceleration
of, or foreclosure of liens securing, any such Bank Debt. Borrower
acknowledges and agrees that (i) its agreements and waivers as contained in
this Section 13.4 were not required as a condition to obtaining the Loan,
but rather were given (A) to induce the commercial banks and other non-Farm
Credit institutions and CoBank to become Syndication Parties and to agree
to provide a portion of the available funds under the Loan, in accordance
with Borrower's wishes, and (B) to enable Borrower to avoid the additional
costs of granting liens to secure any Advances by FCSA with a separate set
of Security Documents from the Security Documents used to grant liens to
secure the funds described in clause (a) hereof, which would also impair
Borrower's ability to obtain Pari Passu Loans, and (ii) neither the
provisions of this Section 13.4 nor the delivery to Borrower of any summary
of any rights under, or any notice pursuant to, the Farm Credit Law shall
in any way be deemed to be, or be construed to in any way indicate, the
determination or agreement by Borrower, the Administrative Agent, any
Syndication Party, and/or any Voting Participants, that the Farm Credit
Law, or any rights thereunder, are or will in fact be applicable to
Borrower, the Loan, or the Loan Documents.
Article 14. AGENCY AGREEMENT
14.1 FUNDING OF SYNDICATION INTEREST. Each Syndication Party,
severally but not jointly, hereby irrevocably agrees to fund its Funding
Share of the Advances ("ADVANCE PAYMENT") as determined pursuant to the
terms and conditions contained herein and in particular, Articles 2 and 3
hereof. Each Syndication Party's interest ("SYNDICATION INTEREST") in each
Advance hereunder shall be without recourse to the Administrative Agent or
any other Syndication Party and shall not be construed as a loan from any
Syndication Party to the Administrative Agent or to any other Syndication
Party.
14.2 SYNDICATION PARTIES' OBLIGATIONS TO REMIT FUNDS. Each
Syndication Party agrees to remit its Funding Share to the Administrative
Agent as, and within the time deadlines ("SYNDICATION PARTY ADVANCE DATE"),
required in this Credit Agreement. Unless the Administrative Agent shall
have received notice from a Syndication Party prior to the date on which
such Syndication Party is to provide funds to the Administrative Agent for
an Advance to be made by such Syndication Party that such Syndication Party
will not make available to the Administrative Agent such funds, the
Administrative Agent may assume that such Syndication Party has made such
funds available to the Administrative Agent on the date of such Advance in
accordance with the terms of this Credit Agreement and the Administrative
Agent in its sole discretion may, but shall not be obligated to, in
reliance upon such assumption, make available to Borrower on such date a
corresponding amount. If and to the extent such Syndication Party shall
not have made such funds available to the Administrative Agent by 2:00 P.M.
(Central time) on the Banking Day due, such Syndication Party agrees to
repay the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such
amount is made available to Borrower until the Banking Day such amount is
repaid to the Administrative Agent (assuming payment is received by the
Administrative Agent at or prior to 2:00 P.M. (Central time), and until the
next Banking Day if payment is not received until after 2:00 P.M.), at the
customary rate set by the Administrative Agent for the correction of errors
among banks for three (3) Banking Days and thereafter at the Base Rate. If
such Syndication Party shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such
Syndication Party's Advance for purposes of this Credit Agreement. If such
Syndication Party does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent shall
promptly notify Borrower, and Borrower shall immediately pay such
corresponding amount to the Administrative Agent with the interest thereon,
for each day from the date such amount is made available to Borrower until
the date such amount is repaid to the Administrative Agent, at the rate of
interest applicable at the time to such Advance.
14.3 SYNDICATION PARTY'S FAILURE TO REMIT FUNDS. If a Syndication
Party ("DELINQUENT SYNDICATION PARTY") fails to remit its Funding Share in
full by the date and time required (the unpaid amount of any such payment
being hereinafter referred to as the "DELINQUENT AMOUNT"), in addition to
any other remedies available hereunder, any other Syndication Party or
Syndication Parties may, but shall not be obligated to, advance the
Delinquent Amount (the Syndication Party or Syndication Parties which
advance such Delinquent Amount are referred to as the "CONTRIBUTING
SYNDICATION PARTIES"), in which case (a) the Delinquent Amount which any
Contributing Syndication Party advances shall be treated as a loan to the
Delinquent Syndication Party and shall not be counted in determining the
Individual Outstanding 7 Year Obligations or Individual Outstanding 10 Year
Obligations, as applicable, of any Contributing Syndication Party, and
(b) the Delinquent Syndication Party shall be obligated to pay to the
Administrative Agent, for the account of the Contributing Syndication
Parties, interest on the Delinquent Amount at a rate of interest equal to
the rate of interest which Borrower is obligated to pay on the Delinquent
Amount plus 200 basis points ("DELINQUENCY INTEREST") until the Delinquent
Syndication Party remits the full Delinquent Amount and remits all
Delinquency Interest to the Administrative Agent, which will distribute
such payments to the Contributing Syndication Parties (pro rata (if more
than one) based on the amount of the Delinquent Amount which each of them
advanced) on the same Banking Day as such payments are received by the
Administrative Agent if received no later than 11:00 A.M. Central time or
the next Banking Day if received by the Administrative Agent thereafter.
In addition, the Contributing Syndication Parties shall be entitled to
share, on the same pro rata basis, and the Administrative Agent shall pay
over to them, for application against Delinquency Interest and the
Delinquent Amount, the Delinquent Syndication Party's Payment Distribution
and any fee distributions or distributions made under Section 14.10 hereof
until the Delinquent Amount and all Delinquency Interest have been paid in
full. For voting purposes the Administrative Agent shall readjust the
Individual Commitments of such Delinquent Syndication Party and the
Contributing Syndication Parties from time to time first to reflect the
advance of the Delinquent Amount by the Contributing Syndication Parties,
and then to reflect the full or partial reimbursement to the Contributing
Syndication Parties of such Delinquent Amount. As between the Delinquent
Syndication Party and the Contributing Syndication Parties, the Delinquent
Syndication Party's interest in its Notes shall be deemed to have been
partially assigned to the Contributing Syndication Parties in the amount of
the Delinquent Amount and Delinquency Interest owing to the Contributing
Syndication Parties from time to time. For the purposes of calculating
interest owed by a Delinquent Syndication Party, payments received on other
than a Banking Day shall be deemed to have been received on the next
Banking Day, and payments received after 2:00 P.M. (Central time) shall be
deemed to have been received on the next Banking Day.
14.4 AGENCY APPOINTMENT. Each of the Syndication Parties hereby
designates and appoints the Administrative Agent to act as agent to service
and collect the Loans and its respective Notes and to take such action on
behalf of such Syndication Party with respect to the Loans and such Notes,
and to execute such powers and to perform such duties, as specifically
delegated or required herein, as well as to exercise such powers and to
perform such duties as are reasonably incident thereto, and to receive and
benefit from such fees and indemnifications as are provided for or set
forth herein, until such time as a successor is appointed and qualified to
act as the Administrative Agent.
14.5 POWER AND AUTHORITY OF THE ADMINISTRATIVE AGENT. Without
limiting the generality of the power and authority vested in the
Administrative Agent pursuant to Section 14.4 hereof, the power and
authority vested in the Administrative Agent includes, but is not limited
to, the following:
14.5.1 ADVICE. To solicit the advice and assistance of each of
the Syndication Parties and Voting Participants concerning the
administration of the Loans and the exercise by the Administrative Agent of
its various rights, remedies, powers, and discretions with respect thereto.
As to any matters not expressly provided for by this Credit Agreement or
any other Loan Document, the Administrative Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder in
accordance with instructions signed by all of the Syndication Parties or
the Required Lenders, as the case may be (and including in each such case,
Voting Participants), and any action taken or failure to act pursuant
thereto shall be binding on all of the Syndication Parties, Voting
Participants, and the Administrative Agent.
14.5.2 DOCUMENTS; INTERCREDITOR AGREEMENT. To execute, seal,
acknowledge, and deliver as the Administrative Agent, (a) all such
instruments as may be appropriate in connection with the administration of
the Loans and the exercise by the Administrative Agent of its various
rights with respect thereto; and (b) upon Borrower's satisfaction of each
condition thereto as specified in Section 1.90 hereof, one or more
Intercreditor Agreements, including agreements by a lender under a Pari
Passu Loan adopting and agreeing to be bound by the same, and the
Administrative Agent agrees to execute an Intercreditor Agreement (or
agreement by a lender under a Pari Passu Loan adopting and being bound by
an Intercreditor Agreement) upon the request of Borrower and upon
Borrower's satisfaction of each condition thereto as specified in Section
1.90 hereof; provided that the Administrative Agent shall not exercise any
rights under an Intercreditor Agreement after its execution except as
directed by the Required Lenders.
14.5.3 PROCEEDINGS. To initiate, prosecute, defend, and to
participate in, actions and proceedings in its name as the Administrative
Agent for the ratable benefit of the Syndication Parties.
14.5.4 RETAIN PROFESSIONALS. To retain attorneys, accountants,
and other professionals to provide advice and professional services to the
Administrative Agent, with their fees and expenses reimbursable to the
Administrative Agent by Syndication Parties pursuant to Section 14.16
hereof.
14.5.5 INCIDENTAL POWERS. To exercise powers reasonably incident
to the Administrative Agent's discharge of its duties enumerated in
Section 14.6 hereof.
14.6 DUTIES OF THE ADMINISTRATIVE AGENT. The duties of the
Administrative Agent hereunder shall consist of the following:
14.6.1 POSSESSION OF DOCUMENTS. To safekeep one original of each
of the Loan Documents other than the Notes (which will be in the possession
of the Syndication Party named as payee therein).
14.6.2 DISTRIBUTE PAYMENTS. To receive and distribute to the
Syndication Parties payments made by Borrower pursuant to the Loan
Documents, as provided herein.
14.6.3 LOAN ADMINISTRATION. Subject to the provisions of
Section 14.7 hereof, to, on behalf of and for the ratable benefit of all
Syndication Parties, in accordance with customary banking practices,
exercise all rights, powers, privileges, and discretion to which the
Administrative Agent is entitled to administer the Loans.
14.6.4 ACTION UPON DEFAULT. Each Syndication Party agrees that
upon its learning of any facts which would constitute a Potential Default
or Event of Default, it shall promptly notify the Administrative Agent by a
writing designated as a notice of default specifying in detail the nature
of such facts and default, and the Administrative Agent shall promptly send
a copy of such notice to all other Syndication Parties. The Administrative
Agent shall be entitled to assume that no Event of Default or Potential
Default has occurred or is continuing unless an officer thereof primarily
responsible for the Administrative Agent's duties as such with respect to
the Loans or primarily responsible for the credit relationship, if any,
between the Administrative Agent and Borrower has actual knowledge of facts
which would result in or constitute a Potential Default or Event of
Default, or has received written notice from Borrower of such fact, or has
received written notice of default from a Syndication Party. In the event
the Administrative Agent has obtained actual knowledge (in the manner
described above) or received written notice of the occurrence of a
Potential Default or Event of Default as provided in the preceding
sentences, the Administrative Agent may, but is not required to exercise or
refrain from exercising any rights which may be available under the Loan
Documents or at law on account of such occurrence and shall be entitled to
use its discretion with respect to exercising or refraining from exercising
any such rights, unless and until the Administrative Agent has received
specific written instruction from the Required Lenders to refrain from
exercising such rights or to take specific designated action, in which case
it shall follow such instruction; provided that the Administrative Agent
shall not be required to take any action which will subject it to personal
liability, or which is or may be contrary to any provision of the Loan
Documents or applicable law. The Administrative Agent shall not be subject
to any liability by reason of its acting or refraining from acting pursuant
to any such instruction.
14.6.5 INDEMNIFICATION AS CONDITION TO ACTION. Except for action
expressly required of the Administrative Agent hereunder, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder unless it shall have received further assurances
(which may include cash collateral) of the indemnification obligations of
the Syndication Parties under Section 14.17 hereof in respect of any and
all liability and expense which may be incurred by it by reason of taking
or continuing to take any such action.
14.6.6 FORWARDING OF INFORMATION. The Administrative Agent
shall, within a reasonable time after receipt thereof, forward to the
Syndication Parties and the Voting Participants notices and reports
provided to the Administrative Agent by the Borrower pursuant to Section
10.2 hereof.
14.7 CONSENT REQUIRED FOR CERTAIN ACTIONS. Notwithstanding the fact
that this Credit Agreement may otherwise provide that the Administrative
Agent may act at its discretion, the Administrative Agent may not take any
of the following actions with respect to, or under, the Loan Documents (nor
may the Syndication Parties or the Voting Participants take the action
described in Subsection 14.7.1(c)) without the prior written consent, given
after notification by the Administrative Agent of its intention to take any
such action (or notification by such Syndication Parties or the Voting
Participants as are proposing the action described in
Subsection 14.7.1(c) of their intention to do so), of:
14.7.1 UNANIMOUS. Each of the Syndication Parties and Voting
Participants holding, directly or, in the case of Voting Participants,
indirectly, an Individual 7 Year Commitment or an Individual 10 Year
Commitment, before:
(a) Agreeing to an increase in the Aggregate 7 Year
Commitment or the Aggregate 10 Year Commitment or an extension of the 7
Year Maturity Date or the 10 Year Maturity Date;
(b) Agreeing to a reduction in the amount, or to a delay in
the due date, of any payment by Borrower of interest, principal, or fees
with respect to the 7 Year Revolving Loan or the 10 Year Revolving Loan;
(c) Amending any provisions of this Subsection 14.7.1 or
Section 15.20; or
(d) Agreeing to release any Collateral from the lien of the
Security Documents except where Borrower is entitled to such release
pursuant to Section 11.4 hereof.
14.7.2 REQUIRED LENDERS. The Required Lenders before:
(a) Consenting to any action or amendment, or granting any
waiver with respect to, either the 7 Year Revolving Loan or the 10 Year
Revolving Loan, not covered in Subsection 14.7.1; or
(b) Agreeing to amend Article 14 of this Credit Agreement
(other than Subsection 14.7.1).
14.7.3 INCREASE IN INDIVIDUAL COMMITMENT AMOUNTS. Neither the
Individual 7 Year Commitment nor the Individual 10 Year Commitment of any
Syndication Party may be increased without (a) the prior written consent of
such Syndication Party and (b) if such increase would result in an increase
in the Aggregate 7 Year Commitment or the Aggregate 10 Year Commitment
compliance with Subsection 14.7.1(a) hereof.
14.7.4 ACTION WITHOUT VOTE. Notwithstanding any other provisions
of this Section, the Administrative Agent may, without obtaining the
consent of the Syndication Parties or Voting Participants, determine
(a) whether the conditions to an Advance have been met, and (b) the amount
of such Advance;
14.7.5 VOTE OF PARTICIPANTS. Under the circumstances set forth
in Section 14.26 hereof, each Voting Participant shall be accorded voting
rights as though such Person was a Syndication Party, and in such case the
voting rights of the Syndication Party from which such Voting Participant
acquired its participation interest shall be reduced accordingly.
14.8 DISTRIBUTION OF PRINCIPAL AND INTEREST. The Administrative Agent
will receive and accept all payments (including prepayments) of principal
and interest made by Borrower on the Loans and the Notes and will hold all
such payments in trust for the benefit of all present and future
Syndication Parties, and, if requested in writing by the Required Lenders,
in an account segregated from the Administrative Agent's other funds and
accounts ("PAYMENT ACCOUNT"). After the receipt by the Administrative
Agent of any payment representing interest or principal on the Loans, the
Administrative Agent shall remit to each Syndication Party its share of
such payment as provided in Article 5 hereof in US dollars ("PAYMENT
DISTRIBUTION") no later than 3:00 P.M. (Central time) on the same Banking
Day as such payment is received by the Administrative Agent if received no
later than 1:00 P.M. (Central time) or the next Banking Day if received by
the Administrative Agent thereafter. Any Syndication Party's rights to its
Payment Distribution shall be subject to the rights of any Contributing
Syndication Parties to such amounts as set forth in Section 14.3 hereof.
14.9 DISTRIBUTION OF CERTAIN AMOUNTS. The Administrative Agent shall
(a) receive and hold in trust for the benefit of all present and future
Syndication Parties, in the Payment Account and, if requested in writing by
the Required Lenders, segregated from the Administrative Agent's other
funds and accounts and (b) shall remit to the Syndication Parties, as
indicated, the amounts described below:
14.9.1 FUNDING LOSSES. To each Syndication Party the amount of
any Funding Losses paid by Borrower to the Administrative Agent in
connection with a prepayment of any portion of a LIBO Rate Loan, in
accordance with the Funding Loss Notice such Syndication Party provided to
the Administrative Agent, no later than 3:00 P.M. (Central time) on the
same Banking Day that payment of such Funding Losses is received by the
Administrative Agent, if received no later than 1:00 P.M. (Central time),
or the next Banking Day if received by the Administrative Agent thereafter.
14.9.2 FEES. To each Syndication Party its share of the
Commitment Fee paid by Borrower to the Administrative Agent, no later than
3:00 P.M. (Central time) on the same Banking Day that payment of such fee
is received by the Administrative Agent, if received no later than 1:00
P.M. (Central time), or the next Banking Day if received by the
Administrative Agent thereafter.
14.10 POSSESSION OF LOAN DOCUMENTS. The Loan Documents (other than
the Notes) shall be held by the Administrative Agent in its name, for the
ratable benefit of itself and the other Syndication Parties without
preference or priority.
14.11 COLLATERAL APPLICATION. The Syndication Parties shall have no
interest in any other loans made to Borrower by any other Syndication Party
other than the Loans, or in any property taken as security for any other
loan or loans made to Borrower by any other Syndication Party, or in any
property now or hereinafter in the possession or control of any other
Syndication Party, which may be or become security for the Loans solely by
reason of the provisions of a security instrument that would cause such
security instrument and the property covered thereby to secure generally
all indebtedness owing by Borrower to such other Syndication Party.
Notwithstanding the foregoing, to the extent such other Syndication Party
applies such funds or the proceeds of such property to reduction of the
Loans, such other Syndication Party shall share such funds or proceeds with
all Syndication Parties according to their respective Individual Pro Rata
Shares. In the event that any Syndication Party shall obtain payment,
whether partial or full, from any source in respect of the Loans, including
without limitation payment by reason of the exercise of a right of offset,
banker's lien, general lien, or counterclaim, such Syndication Party shall
promptly make such adjustments (which may include payment in cash or the
purchase of further syndications or participations in the Loans) to the end
that such excess payment shall be shared with all other Syndication Parties
in accordance with their respective Individual Pro Rata Shares.
14.12 AMOUNTS REQUIRED TO BE RETURNED. If the Administrative Agent
makes any payment to a Syndication Party in anticipation of the receipt of
final funds from Borrower, and such funds are not received from Borrower,
or if excess funds are paid by the Administrative Agent to any Syndication
Party as the result of a miscalculation by the Administrative Agent, then
such Syndication Party shall, on demand of the Administrative Agent,
forthwith return to the Administrative Agent any such amounts, plus
interest thereon (from the day such amounts were transferred by the
Administrative Agent to the Syndication Party to, but not including, the
day such amounts are returned by Syndication Party) at a rate per annum
equal to the customary rate set by the Administrative Agent for the
correction of errors among banks for three (3) Banking Days and thereafter
at the Base Rate. If the Administrative Agent is required at any time to
return to Borrower or a trustee, receiver, liquidator, custodian, or
similar official any portion of the payments made by Borrower to the
Administrative Agent, whether pursuant to any bankruptcy or insolvency law
or otherwise, then each Syndication Party shall, on demand of the
Administrative Agent, forthwith return to the Administrative Agent any such
payments transferred to such Syndication Party by the Administrative Agent
but without interest or penalty (unless the Administrative Agent is
required to pay interest or penalty on such amounts to the person
recovering such payments).
14.13 REPORTS AND INFORMATION TO SYNDICATION PARTIES. The
Administrative Agent shall use reasonable efforts to provide to the
Syndication Parties, as soon as practicable after actual knowledge thereof
is acquired by an officer thereof primarily responsible for the
Administrative Agent's duties as such with respect to the Loans or
primarily responsible for the credit relationship, if any, between the
Administrative Agent and Borrower, any material factual information which
has a material adverse effect on the creditworthiness of Borrower and
Borrower hereby authorizes such disclosure by the Administrative Agent to
the Syndication Parties (and by the Syndication Parties to any of their
participants). Failure of the Administrative Agent to provide the
information referred to in this Section or in Subsection 14.6.4 hereof
shall not result in any liability upon, or right to make a claim against,
the Administrative Agent except where a court of competent jurisdiction
renders a final non-appealable determination that such failure is a result
of the willful misconduct or gross negligence of the Administrative Agent.
The Syndication Parties acknowledge and agree that all information and
reports received pursuant to this Credit Agreement will be received in
confidence in connection with their Syndication Interest, and that such
information and reports constitute confidential information and shall not,
without the prior written consent of the Administrative Agent or Borrower,
as applicable, be (x) disclosed to any third party (other than the
Administrative Agent, another Syndication Party or potential Syndication
Party, or a participant or potential participant in the interest of a
Syndication Party, which disclosure is hereby approved by Borrower), except
pursuant to appropriate legal or regulatory process, or (y) used by the
Syndication Party except in connection with the Loans and its Syndication
Interest.
14.14 STANDARD OF CARE. The Administrative Agent shall not be liable
to the Syndication Parties for any error in judgment or for any action
taken or not taken by the Administrative Agent or its agents, except for
its gross negligence or willful misconduct. Subject to the preceding
sentence, the Administrative Agent will exercise the same care in
administering the Loans and the Loan Documents as it exercises for similar
loans which it holds for its own account and risk, and the Administrative
Agent shall not have any further responsibility to the Syndication Parties.
Without limiting the foregoing, the Administrative Agent may rely on the
advice of counsel concerning legal matters and on any written document it
believes to be genuine and correct and to have been signed or sent by the
proper Person or Persons.
14.15 NO TRUST RELATIONSHIP. Neither the execution of this Credit
Agreement, nor the sharing in the Loans, nor the holding of the Loan
Documents in its name by the Administrative Agent, nor the management and
administration of the Loans and Loan Documents by the Administrative Agent
(including the obligation to hold certain payments and proceeds in the
Payment Account in trust for the Syndication Parties), nor any other right,
duty or obligation of the Administrative Agent under or pursuant to this
Credit Agreement, is intended to be or create, and none of the foregoing
shall be construed to be or create, any express, implied or constructive
trust relationship between the Administrative Agent and any Syndication
Party. Each Syndication Party hereby agrees and stipulates that the
Administrative Agent is not acting as trustee for such Syndication Party
with respect to the Loans, this Credit Agreement, or any aspect of either,
or in any other respect.
14.16 SHARING OF COSTS AND EXPENSES. To the extent not paid by
Borrower, each Syndication Party will promptly upon demand reimburse the
Administrative Agent for its Individual Pro Rata Share of all reasonable
costs, disbursements, and expenses incurred by the Administrative Agent on
or after the date of this Credit Agreement for legal, accounting,
consulting, and other services rendered to the Administrative Agent in its
role as the Administrative Agent in the administration of the Loans,
interpreting the Loan Documents, and protecting, enforcing, or otherwise
exercising any rights, both before and after default by Borrower under the
Loan Documents, and including, without limitation, all costs and expenses
incurred in connection with any bankruptcy proceedings; provided, however,
that the costs and expenses to be shared in accordance with this
Section shall not include any costs or expenses incurred by the
Administrative Agent solely as a Syndication Party in connection with the
Loans, nor the Administrative Agent's internal costs and expenses.
14.17 SYNDICATION PARTIES' INDEMNIFICATION OF THE ADMINISTRATIVE
AGENT. Each of the Syndication Parties agree to indemnify the
Administrative Agent, including any Successor Agent, and their respective
directors, officers, employees, agents, professional advisers and
representatives ("INDEMNIFIED AGENCY PARTIES"), (to the extent not
reimbursed by Borrower, and without in any way limiting the obligation of
Borrower to do so), ratably (based on their Individual Pro Rata Shares),
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of
any kind whatsoever which may at any time (including, without limitation,
at any time following the payment of the Loans and/or the expiration or
termination of this Credit Agreement) be imposed on, incurred by or
asserted against the Administrative Agent (or any of the Indemnified Agency
Parties while acting for the Administrative Agent or for any Successor
Agent) in any way relating to or arising out of this Credit Agreement or
the Loan Documents, or the performance of the duties of the Administrative
Agent hereunder or thereunder or any action taken or omitted while acting
in the capacity of the Administrative Agent under or in connection with any
of the foregoing; provided that the Syndication Parties shall not be liable
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of an Indemnified Agency Party to the extent that any of the
forgoing result from the gross negligence or willful misconduct of that
Indemnified Agency Party as determined by the final non-appealable judgment
of a court of competent jurisdiction. The agreements and obligations in
this Section shall survive the payment of the Loans and the expiration or
termination of this Credit Agreement.
14.18 BOOKS AND RECORDS. The Administrative Agent shall maintain such
books of account and records relating to the Loans as it maintains with
respect to other loans of similar type and amount, and which shall clearly
and accurately reflect the Syndication Interest of each Syndication Party.
Syndication Parties, or their agents, may inspect such books of account and
records at all reasonable times during the Administrative Agent's regular
business hours.
14.19 ADMINISTRATIVE AGENT FEE. The Administrative Agent and any
Successor Agent shall be entitled to the Administrative Agent Fee (as such
fee is set forth in the Fee Letter) for acting as the Administrative Agent.
In the event the Successor Agent is contractually entitled to an additional
fee, each Syndication Party will be responsible for its proportionate share
(based on its Individual Pro Rata Share) thereof.
14.20 THE ADMINISTRATIVE AGENT'S RESIGNATION OR REMOVAL. The
Administrative Agent may resign at any time by giving at least sixty
(60) days' prior written notice of its intention to do so to each of the
Syndication Parties and Borrower. After the receipt of such notice, the
Required Lenders shall appoint a successor ("SUCCESSOR AGENT"). If (a) no
Successor Agent shall have been so appointed which is either (i) a
Syndication Party, or (ii) if not a Syndication Party, which is a Person
approved by Borrower, or (b) if such Successor Agent has not accepted such
appointment, in either case within forty-five (45) days after the retiring
Administrative Agent's giving of such notice of resignation, then the
retiring Administrative Agent may, after consulting with, but without
requiring the approval of, Borrower, appoint a Successor Agent which shall
be a bank or a trust company organized under the laws of the United States
of America or any state thereof and having a combined capital, surplus and
undivided profit of at least $250,000,000.00. Any Administrative Agent may
be removed upon the written demand of the Required Lenders, which demand
shall also appoint a Successor Agent. Upon the appointment of a Successor
Agent hereunder, (y) the term "Administrative Agent" shall for all purposes
of this Credit Agreement thereafter mean such Successor Agent, and (z) the
Successor Agent shall notify Borrower of its identity and of the
information called for in Subsection 15.4.2 hereof. After any retiring
Administrative Agent's resignation hereunder as the Administrative Agent,
or the removal hereunder of any Administrative Agent, the provisions of
this Credit Agreement shall continue to inure to the benefit of such
Administrative Agent as to any actions taken or omitted to be taken by it
while it was the Administrative Agent under this Credit Agreement.
14.21 REPRESENTATIONS AND WARRANTIES OF ALL PARTIES. The
Administrative Agent and each Syndication Party represents and warrants
that: (a) the execution and delivery of, and performance of its
obligations under, this Credit Agreement is within its power and has been
duly authorized by all necessary corporate and other action by it; (b) this
Credit Agreement is in compliance with all applicable laws and regulations
promulgated under such laws and does not conflict with nor constitute a
breach of its charter or by-laws nor any agreements by which it is bound,
and does not violate any judgment, decree or governmental or administrative
order, rule or regulation applicable to it; (c) no approval, authorization
or other action by, or declaration to or filing with, any governmental or
administrative authority or any other Person is required to be obtained or
made by it in connection with the execution and delivery of, and
performance of its obligations under, this Credit Agreement; and (d) this
Credit Agreement has been duly executed by it, and constitutes the legal,
valid, and binding obligation of such Person, enforceable in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the rights of creditors generally and general equitable
principles (regardless of whether such enforceability is considered in a
proceeding at law or in equity). Each Syndication Party that is a state or
national bank represents and warrants that the act of entering into and
performing its obligations under this Credit Agreement has been approved by
its board of directors or its loan committee and such action was duly noted
in the written minutes of the meeting of such board or committee, and that
it will, if requested to do so by the Administrative Agent, furnish the
Administrative Agent with a certified copy of such minutes or an excerpt
therefrom reflecting such approval.
14.22 REPRESENTATIONS AND WARRANTIES OF COBANK. Except as expressly
set forth in Section 14.21 hereof, the Administrative Agent makes no
express or implied representation or warranty and assumes no
responsibilities with respect to the due authorization, execution, or
delivery of the Loan Documents; the accuracy of any information,
statements, or certificates provided by Borrower, the legality, validity,
or enforceability of the Loan Documents; the filing or recording of any
document; the collectibility of the Loans; the performance by Borrower of
any of its obligations under the Loan Documents; or the financial condition
or solvency of Borrower or any other party obligated with respect to the
Loans or the Loan Documents.
14.23 SYNDICATION PARTIES' INDEPENDENT CREDIT ANALYSIS. Each
Syndication Party acknowledges receipt of true and correct copies of all
Loan Documents (other than any Note payable to another Syndication
Party) from the Administrative Agent. Each Syndication Party agrees and
represents that it has relied upon its independent review (a) of the Loan
Documents, and (b) any information independently acquired by such
Syndication Party from Borrower or otherwise in making its decision to
acquire an interest in the Loans independently and without reliance on the
Administrative Agent. Each Syndication Party represents and warrants that
it has obtained such information as it deems necessary (including any
information such Syndication Party independently obtained from Borrower or
others) prior to making its decision to acquire an interest in the Loans.
Each Syndication Party further agrees and represents that it has made its
own independent analysis and appraisal of and investigation into each
Borrower's authority, business, operations, financial and other condition,
creditworthiness, and ability to perform its obligations under the Loan
Documents and has relied on such review in making its decision to acquire
an interest in the Loans. Each Syndication Party agrees that it will
continue to rely solely upon its independent review of the facts and
circumstances related to Borrower, and without reliance upon the
Administrative Agent, in making future decisions with respect to all
matters under or in connection with the Loan Documents and the Loans. The
Administrative Agent assumes no responsibility for the financial condition
of Borrower or for the performance of Borrower's obligations under the Loan
Documents. Except as otherwise expressly provided herein, no Syndication
Party shall have any duty or responsibility to furnish to any other
Syndication Parties any credit or other information concerning Borrower
which may come into its possession.
14.24 NO JOINT VENTURE OR PARTNERSHIP. Neither the execution of this
Credit Agreement, the sharing in the Loans, nor any agreement to share in
payments or losses arising as a result of this transaction is intended to
be or to create, and the foregoing shall not be construed to be, any
partnership, joint venture or other joint enterprise between the
Administrative Agent and any Syndication Party, nor between or among any of
the Syndication Parties.
14.25 PURCHASE FOR OWN ACCOUNT; RESTRICTIONS ON TRANSFER;
PARTICIPATIONS. Each Syndication Party represents that it has acquired and
is retaining its interest in the Loans for its own account in the ordinary
course of its banking or financing business. Each Syndication Party agrees
that it will not sell, assign, convey or otherwise dispose of
("TRANSFER") to any Person, or create or permit to exist any lien or
security interest on, all or any part of its interest in the Loans without
the prior written consent of the Administrative Agent and Borrower (which
consent will not be unreasonably withheld); provided that: (a) any such
Transfer (except a Transfer to another Syndication Party) must be in a
minimum amount of $5,000,000.00; (b) each Syndication Party must maintain
an Individual Commitment of no less than $5,000,000.00, unless it Transfers
its entire interest in the Loans; (c) no consent shall be required from
Borrower during any period when an Event of Default shall have occurred and
be continuing; (d) the transferee must execute an agreement substantially
in the form of EXHIBIT 14.25 hereto ("SYNDICATION ACQUISITION
AGREEMENT") and assume all of the transferor's obligations hereunder and
execute such documents as the Administrative Agent may reasonably require;
and (e) the Syndication Party making such Transfer must pay the
Administrative Agent an assignment fee of $3,500.00. Upon receipt of such
fee and the properly executed Syndication Acquisition Agreement, the
assignee of such Transfer shall thereafter be treated as the Syndication
Party with respect to the Syndication Interest subject to the Transfer and
shall receive all future Payment Distributions, and the assignor and
assignee shall make all adjustments and payments between themselves
appropriate with respect to such future Payment Distributions. Any
Syndication Party may participate any part of its interest in the Loans to
any Person with the prior written consent of the Administrative Agent and
Borrower (which consent will not be unreasonably withheld), provided that
(l) no such consent shall be required where the participant is a Person at
least fifty percent (50%) the equity interest in which is owned by such
Syndication Party or which owns at least fifty percent (50%) of the equity
interest in such Syndication Party or at least fifty percent (50%) of the
equity interest of which is owned by the same Person which owns at least
fifty percent (50%) of the equity interest of such Syndication Party and
(m) no consent shall be required from Borrower during any period when an
Event of Default shall have occurred and be continuing, and, further, each
Syndication Party understands and agrees that in the event of any such
participation: (y) its obligations hereunder will not change on account of
such participation, and (z) except as provided in Section 14.26 hereof with
respect to voting rights, (i) the participant will have no rights under
this Credit Agreement, including, without limitation, voting rights (except
for such participants which qualify as a Voting Participant) or the right
to receive payments or distributions; and (ii) the Administrative Agent
shall continue to deal directly with the Syndication Party with respect to
the Loans (including with respect to voting rights - except for such
participants which qualify as a Voting Participant) as though no
participation had been granted and will not be obligated to deal directly
with any participant. Notwithstanding any provision contained herein to
the contrary, any Syndication Party may at any time pledge or assign all or
any portion of its interest in the Loans to any Federal Reserve Bank or the
Federal Farm Credit Bank's Funding Corporation in accordance with
applicable law.
14.26 CERTAIN PARTICIPANTS' VOTING RIGHTS. All Persons ("VOTING
PARTICIPANTS") who (a) have, directly or indirectly, purchased a
participation interest in the minimum amount of $10,000,000.00 in a
Syndication Party's Syndication Interest as of the Closing Date and
(b) have on the Closing Date been designated in writing to Borrower and the
Administrative Agent as having such entitlement (as evidenced by their name
and dollar participation amount appearing on EXHIBIT 14.26 hereto), shall
be entitled to vote (and such Syndication Party's voting rights shall be
correspondingly reduced), on a dollar basis, as if such participant were a
Syndication Party, on any matter requiring or allowing a Syndication Party,
to provide or withhold its consent, or to otherwise vote on any proposed
action.
14.27 METHOD OF MAKING PAYMENTS. Payment and transfer of all amounts
owing or to be paid or remitted hereunder to the Administrative Agent by
the Syndication Parties, including, without limitation, payment of the
Advance Payment, shall be by wire transfer in accordance with the
instructions contained on EXHIBIT 14.27 hereto ("WIRE INSTRUCTIONS").
Payment and transfer of all amounts to be paid or remitted hereunder to the
Syndication Parties by the Administrative Agent, including, without
limitation, Payment Distributions, shall be by wire transfer in accordance
with the instructions contained on their respective signature pages hereto.
14.28 EVENTS OF SYNDICATION DEFAULT/REMEDIES.
14.28.1 SYNDICATION PARTY DEFAULT. Any of the following
occurrences, failures or acts, with respect to any of the Syndication
Parties shall constitute an "EVENT OF SYNDICATION DEFAULT" hereunder by
such Syndication Party: (a) if any representation or warranty made by such
Syndication Party in this Credit Agreement shall be found to have been
untrue in any material respect; (b) if such Syndication Party fails to make
any distributions or payments required under this Credit Agreement within
five (5) days of the date required; (c) if such Syndication Party breaches
any other covenant, agreement, or provision of this Credit Agreement which
breach shall have continued uncured for a period of thirty (30) consecutive
days after such breach first occurs, unless a shorter period is required to
avoid prejudicing the rights and position of the other Syndication Parties;
(d) if any agency having supervisory authority over such Syndication Party,
or any creditors thereof, shall file a petition to reorganize or liquidate
such Syndication Party pursuant to any applicable federal or state law or
regulation and such petition shall not be discharged or denied within
fifteen (15) days after the date on which it is filed; (e) if by the order
of a court of competent jurisdiction or by any appropriate supervisory
agency, a receiver, trustee or liquidator shall be appointed for such
Syndication Party or for all or any material part of its property or if
such Syndication Party shall be declared insolvent; or (f) if such
Syndication Party shall be dissolved, or shall make an assignment for the
benefit of its creditors, or shall file a petition seeking to take
advantage of any debtors' act, including the bankruptcy act, or shall admit
in writing its inability to pay its debts generally as they become due, or
shall consent to the appointment of a receiver or liquidator of all or any
material part of its property.
14.28.2 REMEDIES. Upon the occurrence of an Event of Syndication
Default, the non-defaulting Syndication Parties, acting by, or through the
direction of, a simple majority of the non-defaulting Syndication Parties
(determined based on the ratio of the total of their Individual Commitments
to the Aggregate Commitment), may, in addition to any other remedy
specifically set forth in this Credit Agreement, have and exercise any and
all remedies available generally at law or equity, including the right to
damages and to specific performance.
14.29 WITHHOLDING TAXES. Each Syndication Party represents that it is
entitled to receive any payments to be made to it hereunder without the
withholding of any tax and will furnish to the Administrative Agent and to
Borrower such forms, certifications, statements and other documents as the
Administrative Agent or Borrower may request from time to time to evidence
such Syndication Party's exemption from the withholding of any tax imposed
by any jurisdiction or to enable the Administrative Agent or Borrower, as
the case may be, to comply with any applicable laws or regulations relating
thereto. Without limiting the effect of the foregoing, if any Syndication
Party is not created or organized under the laws of the United States of
America or any state thereof, such Syndication Party will furnish to the
Administrative Agent and Borrower IRS Form 4224 or Form 1001, or such other
forms, certifications, statements or documents, duly executed and completed
by such Syndication Party, as evidence of such Syndication Party's
exemption from the withholding of United States tax with respect thereto.
Notwithstanding anything herein to the contrary, Borrower shall not be
obligated to make any payments hereunder to or for the benefit of such
Syndication Party until such Syndication Party shall have furnished to the
Administrative Agent and Borrower the requested form, certification,
statement or document.
14.30 AMENDMENTS CONCERNING AGENCY FUNCTION. The Administrative Agent
shall not be bound by any waiver, amendment, supplement or modification of
this Credit Agreement or any other Loan Document which affects its duties
hereunder or thereunder unless it shall have given its prior written
consent thereto.
14.31 REALLOCATION OF OUTSTANDING ADVANCES. Each of the Syndication
Parties agrees that: (a) the aggregate outstanding balance of 7 Year
Advances as of the Closing Date shall on such date be reallocated among the
Syndication Parties in accordance with the ratio which their Individual 7
Year Commitment bears to the Aggregate 7 Year Commitment on such date as
determined by the Administrative Agent; (b) the aggregate outstanding
balance of 10 Year Advances as of the Closing Date shall on such date be
reallocated among the Syndication Parties in accordance with the ratio
which their Individual 10 Year Commitment bears to the Aggregate 10 Year
Commitment on such date as determined by the Administrative Agent; and
(c) to the extent such reallocation as described in clauses (a) and (b) of
this Section ("REALLOCATION") results in the 7 Year Advances and/or 10 Year
Advances allocated to any Syndication Party being in excess of the 7 Year
Advances and/or 10 Year Advances which were allocated to such Syndication
Party under the 1999 Credit Agreement immediately prior to such
Reallocation, such Syndication Party shall remit to the Administrative
Agent funds in the amount of such excess by 2:00 P.M. (Central time) on the
Closing Date in the manner provided in Section 14.27 hereof. To the extent
such Reallocation results in the 7 Year Advances and/or 10 Year Advances
allocated to any Syndication Party being less than the 7 Year Advances
and/or 10 Year Advances which were allocated to such Syndication Party
under the 1999 Credit Agreement immediately prior to such Reallocation
("REDUCTION"), the Administrative Agent shall, from funds it receives
pursuant to clause (c) of this Section, remit the amount of such Reduction
to such Syndication Party in the manner provided in Section 14.27 hereof.
14.32 FURTHER ASSURANCES. The Administrative Agent and each
Syndication Party agree to take whatever steps and execute such documents
as may be reasonable and necessary to implement this Article 14 and to
carry out fully the intent thereof.
Article 15. MISCELLANEOUS
15.1 COSTS AND EXPENSES. To the extent permitted by law, Borrower
agrees to pay to the Administrative Agent and/or the Syndication Parties,
as applicable, on demand, all out-of-pocket costs and expenses
(a) reasonably incurred by the Administrative Agent (including, without
limitation, the reasonable fees and expenses of counsel retained by the
Administrative Agent, and including fees and expenses incurred for
consulting, appraisal, engineering, inspection, and environmental
assessment services) in connection with the preparation, negotiation, and
execution of the Fee Letter, mandate letter, Summary of Terms and
Conditions, and the Amendment Documents and the transactions contemplated
thereby, processing the Borrowing Notices, and processing requests for and
implementing Pari Passu Loans, and (b) incurred by the Administrative Agent
or any Syndication Party (including, without limitation, the reasonable
fees and expenses of counsel retained by the Administrative Agent and the
Syndication Parties) in connection with the enforcement or protection of
the Syndication Parties' rights under the Loan Documents upon the
occurrence of an Event of Default, including without limitation collection
of the Loan (regardless of whether such enforcement or collection is by
court action or otherwise) or, unless it is determined by a final non-
appealable judgment that the Administrative Agent or such Syndication
Party, as applicable, has acted in a grossly negligent or willful manner,
upon the commencement of an action by Borrower against the Administrative
Agent or any Syndication Party. Borrower shall not be obligated to pay the
costs or expenses of any Person whose only interest in the Loan is as a
holder of a participation interest.
15.2 SERVICE OF PROCESS AND CONSENT TO JURISDICTION. Borrower hereby
agrees that any litigation with respect to this Credit Agreement or to
enforce any judgment obtained against Borrower for breach of this Credit
Agreement or under the Notes or other Loan Documents may be brought in the
courts of the State of Colorado and in the United States District Court for
the District of Colorado (if applicable subject matter jurisdictional
requirements are present), as the Administrative Agent may elect; and, by
execution and delivery of this Credit Agreement, Borrower irrevocably
submits to such jurisdiction. With respect to litigation concerning this
Credit Agreement or under the Notes or other Loan Documents within the
jurisdiction of the courts of the State of Colorado or the United States
District Court for the District of Colorado, Borrower hereby agrees to
irrevocably appoint a Person with offices in Denver, Colorado and otherwise
reasonably acceptable to the Administrative Agent to serve, until six
(6) months after the 10 Year Maturity Date, to serve as the agent of
Borrower to receive for and on behalf of Borrower at such agent's Denver,
Colorado office, service of process, which service may be made by mailing a
copy of any summons or other legal process to Borrower in care of such
agent. Borrower agrees that Borrower shall maintain a duly appointed agent
in Colorado for service of summons and other legal process as long as
Borrower remains obligated under this Credit Agreement and shall keep the
Administrative Agent advised in writing of the identity and location of
such agent. The receipt by such agent and/or by Borrower of such summons
or other legal process in any such litigation shall be deemed personal
service and acceptance by Borrower for all purposes of such litigation.
15.3 JURY WAIVER. IT IS MUTUALLY AGREED BY AND BETWEEN THE
ADMINISTRATIVE AGENT, EACH SYNDICATION PARTY, AND BORROWER THAT THEY EACH
WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY
ANY OF THEM AGAINST ANY OTHER PARTY ON ANY MATTER WHATSOEVER ARISING OUT OF
OR IN ANY WAY CONNECTED WITH THIS CREDIT AGREEMENT, THE NOTES, OR THE OTHER
LOAN DOCUMENTS.
15.4 NOTICES. All notices, requests and demands required or permitted
under the terms of this Credit Agreement shall be in writing and (a) shall
be addressed as set forth below or at such other address as either party
shall designate in writing, (b) shall be deemed to have been given or made:
(i) if delivered personally, immediately upon delivery, (ii) if by telex,
telegram, or facsimile transmission, immediately upon sending and upon
confirmation of receipt, (iii) if by nationally recognized overnight
courier service with instructions to deliver the next Banking Day, one
(1) Banking Day after sending, and (iv) if by United States Mail, certified
mail, return receipt requested, five (5) days after mailing.
15.4.1 BORROWER:
Pilgrim's Pride Corporation
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx 00000
FAX: (000) 000-0000
Attention: Chief Financial Officer
with a copy to:
Xxxxx & XxXxxxxx
4500 Xxxxxxxx Xxxx Center
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
FAX: (000) 000-0000
Attention: Xxxx X. Xxxxxx
15.4.2 ADMINISTRATIVE AGENT:
CoBank, ACB
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxx Xxxxxxx, Xxxxxxxx 00000
FAX: (000) 000-0000
Attention: Syndications Coordinator, Corporate Finance Division
15.4.3 FCSA:
Farm Credit Services of America, FLCA
000 Xxxxx 00xx Xxxxxx
Xxxxx, Xxxxxxxx 00000
FAX: (000) 000-0000
Attention: Xxx Xxxxx
15.4.4 SYNDICATION PARTIES:
See signature pages hereto.
15.5 LIABILITY OF ADMINISTRATIVE AGENT. Neither the Administrative
Agent nor the Co-Arrangers shall have any liabilities or responsibilities
to Borrower or any Subsidiary on account of the failure of any Syndication
Party to perform its obligations hereunder or to any Syndication Party on
account of the failure of Borrower or any Subsidiary to perform their
respective obligations hereunder or under any other Loan Document.
15.6 SUCCESSORS AND ASSIGNS. This Credit Agreement shall be binding
upon and inure to the benefit of Borrower, the Administrative Agent, the
Co-Arrangers, and the Syndication Parties, and their respective successors
and assigns, except that Borrower may not assign or transfer its rights or
obligations hereunder without the prior written consent of all of the
Syndication Parties.
15.7 SEVERABILITY. The invalidity or unenforceability of any
provision of this Credit Agreement or the other Loan Documents shall not
affect the remaining portions of such documents or instruments; in case of
such invalidity or unenforceability, such documents or instruments shall be
construed as if such invalid or unenforceable provisions had not been
included therein.
15.8 ENTIRE AGREEMENT. This Credit Agreement (together with all
exhibits hereto, which are incorporated herein by this reference), the
other Loan Documents, and the letter of even date herewith between Borrower
and the Administrative Agent regarding certain post-closing matters ("POST
CLOSING LETTER"), represent the entire understanding of the Administrative
Agent, the Co-Arrangers, each Syndication Party, and Borrower with respect
to the subject matter hereof and shall replace and supersede any previous
agreements of the parties with respect to the subject matter hereof.
15.9 APPLICABLE LAW. To the extent not governed by federal law, this
Credit Agreement and the other Loan Documents, and the rights and
obligations of the parties hereto and thereto shall be governed by and
interpreted in accordance with the internal laws of the State of Colorado,
without giving effect to any otherwise applicable rules concerning
conflicts of law.
15.10 CAPTIONS. The captions or headings in this Credit Agreement and
any table of contents hereof are for convenience only and in no way define,
limit or describe the scope or intent of any provision of this Credit
Agreement.
15.11 COMPLETE AGREEMENT; AMENDMENTS. This Credit Agreement, the
Notes, and the other Loan Documents are intended by the parties hereto to
be a complete and final expression of their agreement and may not be
contradicted by evidence of any prior or contemporaneous oral agreement.
The Administrative Agent, each Syndication Party, and Borrower acknowledge
and agree that there is no unwritten oral agreement between them with
respect to the subject matter of this Credit Agreement. This Credit
Agreement may not be modified or amended unless such modification or
amendment is in writing and is signed by Borrower, the Administrative
Agent, the Co-Arrangers, and the Required Lenders or, where this Credit
Agreement requires the consent of all Syndication Parties, then by all of
the Syndication Parties (and each Syndication Party hereby agrees to
execute any such amendment approved pursuant to Section 14.7 hereof).
Borrower agrees that it shall reimburse the Administrative Agent for all
reasonable fees and expenses incurred by the Administrative Agent in
retaining outside legal counsel in connection with any amendment or
modification to this Credit Agreement.
15.12 ADDITIONAL COSTS OF MAINTAINING LOAN. Borrower shall pay to the
Administrative Agent from time to time such amounts as the Administrative
Agent may determine to be necessary to compensate any Syndication Party for
any increase in costs to such Syndication Party which the Administrative
Agent reasonably determines, based on information presented to it by such
Syndication Party, are attributable to such Syndication Party's making or
maintaining an Advance hereunder or its obligation to make such Advance, or
any reduction in any amount receivable by such Syndication Party under this
Credit Agreement or the Notes payable to it in respect to such Advance or
such obligation (such increases in costs and reductions in amounts
receivable being herein called "ADDITIONAL COSTS"), resulting from any
change after the date of this Credit Agreement in United States federal,
state, municipal, or foreign laws or regulations (including Regulation D of
the Federal Reserve Board), or the adoption or making after such date of
any interpretations, directives, or requirements applying to a class of
banks including such Syndication Party of or under any United States
federal, state, municipal, or foreign laws or regulations (whether or not
having the force of law) by any court or governmental or monetary authority
charged with the interpretation or administration thereof ("REGULATORY
CHANGE"), which: (a) changes the basis of taxation of any amounts payable
to such Syndication Party under this Credit Agreement or the Notes payable
to such Syndication Party in respect of such Advance (other than taxes
imposed on the overall net income of such Syndication Party); or
(b) imposes or modifies any reserve, special deposit, or similar
requirements relating to any extensions of credit or other assets of, or
any deposits with or other liabilities of, such Syndication Party; or
(c) imposes any other condition affecting this Credit Agreement or the
Notes payable to such Syndication Party (or any of such extensions of
credit or liabilities). The Administrative Agent will notify Borrower of
any event occurring after the date of this Credit Agreement which will
entitle such Syndication Party to compensation pursuant to this Section as
promptly as practicable after it obtains knowledge thereof and determines
to request such compensation. The Administrative Agent shall include with
such notice, a certificate from such Syndication Party setting forth in
reasonable detail the calculation of the amount of such compensation.
Determinations by the Administrative Agent for purposes of this Section of
the effect of any Regulatory Change on the costs of such Syndication Party
of making or maintaining an Advance or on amounts receivable by such
Syndication Party in respect of Advances, and of the additional amounts
required to compensate such Syndication Party in respect of any Additional
Costs, shall be conclusive absent manifest error, provided that such
determinations are made on a reasonable basis.
15.13 CAPITAL REQUIREMENTS. In the event after the date of this
Credit Agreement of the introduction of or any change in: (a) any law or
regulation; (b) the judicial, administrative, or other governmental
interpretation of any law or regulation; or (c) compliance by any
Syndication Party or any corporation controlling any such Syndication Party
with any guideline or request from any governmental authority (whether or
not having the force of law) has the effect of requiring an increase in the
amount of capital required or expected to be maintained by such Syndication
Party or any corporation controlling such Syndication Party, and such
Syndication Party certifies, based on a reasonable determination, that such
increase is based in any part upon such Syndication Party's obligations
hereunder with respect to the 7 Year Revolving Loan and/or the 10 Year
Revolving Loan, and other similar obligations, Borrower shall pay to such
Syndication Party such additional amount as shall be certified by such
Syndication Party to the Administrative Agent and to Borrower to be the net
present value of (y) the amount by which such increase in capital reduces
the rate of return on capital which such Syndication Party could have
achieved over the period remaining until the 7 Year Maturity Date or the 10
Year Maturity Date, as applicable (depending upon which Facility or
Facilities such claim to increased costs is based), but for such
introduction or change, (z) multiplied by the product of such Syndication
Party's Individual 7 Year Pro Rata Share times the Aggregate 7 Year
Commitment or such Syndication Party's Individual 10 Year Pro Rata Share
times the Aggregate 10 Year Commitment, as applicable. The Administrative
Agent will notify Borrower of any event occurring after the date of this
Credit Agreement that will entitle any such Syndication Party to
compensation pursuant to this Section as promptly as practicable after it
obtains knowledge thereof and of such Syndication Party's determination to
request such compensation. The Administrative Agent shall include with
such notice, a certificate from such Syndication Party setting forth in
reasonable detail the calculation of the amount of such compensation.
Determinations by any Syndication Party for purposes of this Section of the
effect of any increase in the amount of capital required to be maintained
by any such Syndication Party and of the amount of compensation owed to any
such Syndication Party under this Section shall be conclusive absent
manifest error, provided that such determinations are made on a reasonable
basis.
15.14 REPLACEMENT NOTES. Upon receipt by Borrower of evidence
satisfactory to it of: (a) the loss, theft, destruction or mutilation of
any Note, and (in case of loss, theft or destruction) of the agreement of
the Syndication Party to which the Note was payable to indemnify Borrower,
and upon surrender and cancellation of such Note, if mutilated; or (b) the
assignment by any Syndication Party of all or a portion of its Syndication
Interest hereunder and the Note relating thereto, pursuant to this Credit
Agreement, including assignments as a result of the Reallocation, then
Borrower will deliver in lieu of such Note a new Note or, in the case of an
assignment of a portion of a Syndication Interest, new Notes, for any
remaining balance. All Notes executed pursuant to this Section shall be
dated as of the Effective Date. The Syndication Parties shall, as soon as
practical after receipt of such new executed Notes, return to Borrower the
Note which has been replaced by such new Note or Notes.
15.15 MUTUAL RELEASE. Upon full indefeasible payment and satisfaction
of the Bank Debt and Notes and the other obligations contained in this
Credit Agreement, the parties, including Borrower, the Administrative
Agent, the Co-Arrangers, and each Syndication Party shall, except as
provided in Article 14 hereof, thereupon automatically each be fully,
finally, and forever released and discharged from any further claim,
liability, or obligation in connection with the Bank Debt.
15.16 LIBERAL CONSTRUCTION. This Credit Agreement constitutes a fully
negotiated agreement between commercially sophisticated parties, each
assisted by legal counsel, and shall not be construed and interpreted for
or against any party hereto.
15.17 COUNTERPARTS. This Credit Agreement may be executed by the
parties hereto in separate counterparts, each of which, when so executed
and delivered, shall be an original, but all such counterparts shall
together constitute one and the same instrument. Each counterpart may
consist of a number of copies hereof, each signed by less than all, but
together signed by all, of the parties hereto. Telefax copies of documents
or signature pages bearing original signatures, and executed documents or
signature pages delivered by telefax, shall, in each such instance, be
deemed to be, and shall constitute and be treated as, an original signed
document or counterpart, as applicable.
15.18 CONFIDENTIALITY. Each Syndication Party shall, subject to the
exceptions below, maintain the confidential nature of, and shall not use or
disclose, any of Borrower's financial information, confidential information
or trade secrets without first obtaining Borrower's written consent.
Nothing in this Section shall require any Syndication Party to obtain such
consent following the occurrence and during the continuation of an Event of
Default in connection with the exercise by the Administrative Agent or any
Syndication Party of its or their rights and remedies hereunder or under
any of the other Loan Documents. The obligations of the Syndication
Parties shall in no event apply to: (a) providing information about
Borrower to any financial institution contemplated in Sections 14.6, 14.13,
and 14.25 hereof or to such Syndication Party's parent holding company or
any of such Syndication Party's affiliates (provide such Person is bound by
similar confidentiality provisions limiting further disclosure); (b) any
situation in which any Syndication Party is required by law, regulation, or
subpoena or required by any Governmental Authority to disclose information;
(c) providing information to counsel to the Administrative Agent or any
Syndication Party in connection with the transactions contemplated by the
Loan Documents or in connection with the exercise of its or their rights or
remedies thereunder; (d) providing information to officers, directors,
employees, agents and representatives of such Syndication Party as need to
know such information or to independent auditors retained by such
Syndication Party (it being understood that they shall be informed by such
Syndication Party of the confidential nature of such information and that
such Syndication Party shall take reasonable steps to cause them to treat
such information on a confidential basis); (e) any information that is in
or becomes part of the public domain otherwise than through a wrongful act
of such Syndication Party or any of its employees or agents thereof;
(f) any information that is in the possession of any Syndication Party
prior to receipt thereof from Borrower or any other Person known to such
Syndication Party to be acting on behalf of Borrower; (g) any information
that is independently developed by any Syndication Party; and (h) any
information that is disclosed to any Syndication Party by a third party
that has no obligation of confidentiality with respect to the information
disclosed. A Syndication Party's confidentiality requirements continue
after it is no longer a Syndication Party under this Credit Agreement.
15.19 LIMITATION OF LIABILITY. NEITHER BORROWER NOR ANY SUBSIDIARY
MAY MAKE ANY CLAIM AGAINST THE ADMINISTRATIVE AGENT, ANY SYNDICATION PARTY,
OR THE AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS OR AGENTS
THEREOF FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES IN RESPECT OF
ANY BREACH OR WRONGFUL CONDUCT (WHETHER BASED IN CONTRACT, TORT, OR
OTHERWISE) IN CONNECTION WITH, ARISING OUT OF OR IN ANY WAY RELATED TO THE
TRANSACTIONS CONTEMPLATED BY THIS CREDIT AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH.
BORROWER HEREBY WAIVES, RELEASES AND AGREES NOT TO XXX (AND AGREES NOT TO
CONSENT TO ANY SUCH SUIT BY A SUBSIDIARY) UPON ANY CLAIM FOR ANY SUCH
DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO
EXIST. IN ADDITION, BORROWER ACKNOWLEDGES AND AGREES THAT NEITHER THE
ADMINISTRATIVE AGENT NOR ANY SYNDICATION PARTY HAS ANY DUTY OR REVIEW OR
ADVISE BORROWER WITH RESPECT TO ANY PHASE OF ITS BUSINESS OPERATIONS OF
CONDITION, THE RELATIONSHIP BEING SOLELY THAT OF DEBTOR AND CREDITORS AND
THEIR BEING NO TRUST RELATIONSHIP OR RELIANCE.
15.20 AFFECT OF AMENDED AND RESTATED CREDIT AGREEMENT. This Credit
Agreement shall be effective from the Effective Date forward, and the
execution of this Credit Agreement shall not relieve any party to the 1999
Credit Agreement from their respective obligations thereunder for the
period from the Original Effective Date to the Effective Date or from any
liability for the failure to perform such obligations or from any liability
arising out of indemnification obligations under the 1999 Credit Agreement.
[SIGNATURES BEGIN ON PAGE 100]
2
IN WITNESS WHEREOF, the parties have executed this Credit Agreement as
of the date first above written.
BORROWER:
PILGRIM'S PRIDE CORPORATION, a corporation
formed under the laws of the State of
Delaware
By: _________________________________
Name: _________
Title: _________
ADMINISTRATIVE AGENT:
COBANK, ACB
By:
Name: Xxxxxx Xxxx
Title: Vice President
CO-ARRANGER:
FARM CREDIT SERVICES OF AMERICA, FLCA
By:
Name: _________
Title: ___________
TABLE OF CONTENTS
1.1 Acquisition Agreement
1.2 Acquisition Corp.
1.3 Administrative Agent Office
1.4 Advance
1.5 Advance Date
1.6 Aggregate Commitment
1.7 Aggregate 7 Year Commitment
1.8 Aggregate 10 Year Commitment
1.9 Amendment Documents
1.10 Applicable Lending Office
1.11 Applicable Margin
1.12 Appraisal
1.13 Appraised Value
1.14 Availability Period
1.15 Available Amount
1.16 Bank Debt
1.17 Banking Day
1.18 Base Rate
1.19 Borrower's Account
1.20 Borrower Benefit Plan
1.21 Borrower's Pledge Agreement
1.22 Capital Lease
1.23 Capital Lease Obligation
1.24 Casualty Event
1.25 Casualty Proceeds
1.26 Closing Date
1.27 Code
1.28 Collateral
1.29 Comerica Loan
1.30 Committed 10 Year Advances
1.31 Committed 7 Year Advances
1.32 Compliance Certificate
1.33 Consolidated Current Assets
1.34 Consolidated Current Liabilities
1.35 Consolidated Interest Expense
1.36 Consolidated Net Income
1.37 Consolidated Subsidiary
1.38 Converted Loans
1.39 Current Assets
1.40 Current Liabilities
1.41 Current Ratio
1.42 Debt
1.43 Default Interest Rate
1.44 Depreciation
1.45 EBITDA
1.46 Environmental Laws
1.47 ERISA
1.48 ERISA Affiliate
1.49 Facilities
1.50 Financial Projections
1.51 Fiscal Quarter
1.52 Fiscal Year
1.53 Fixed Charge Coverage Ratio
1.54 Funding Share
1.55 GAAP
1.56 Good Faith Contest
1.57 Governmental Authority
1.58 Xxxxxxx Loan
1.59 Xxxxxx Loan
1.60 Hazardous Substances
1.61 Individual Commitment
1.62 Individual Outstanding 7 Year Obligations
1.63 Individual Outstanding 10 Year Obligations
1.64 Individual Pro Rata Share
1.65 Individual 7 Year Commitment
1.66 Individual 7 Year Lending Capacity
1.67 Individual 7 Year Pro Rata Share
1.68 Individual 10 Year Commitment
1.69 Individual 10 Year Lending Capacity
1.70 Individual 10 Year Pro Rata Share
1.71 Intangible Asset
1.72 Interest Expense
1.73 Investment
1.74 Leverage Ratio
1.75 LIBO Rate
1.76 Lien
1.77 Loans
1.78 Loan Documents
1.79 Material Adverse Effect
1.80 Material Agreements
1.81 Merger
1.82 Merger Consummation Date
1.83 Multiemployer Plan
1.84 Net Tangible Assets
1.85 Net Working Capital
1.86 Net Worth
1.87 Note or Notes
1.88 Operating Lease
1.89 Organizational Documents
1.90 Pari Passu Loan
1.91 Person
1.92 Plan
1.93 Post Closing Letter:
1.94 Potential Default
1.95 Prohibited Transaction
1.96 Reportable Event
1.97 Required Lenders
1.98 Security Documents
1.99 7 Year Maturity Date
1.100 7 Year Revolving Loan
1.101 Subsidiary
1.102 Subsidiary Merger
1.103 Successor Agent
1.104 Survivor
1.105 Survivor Pledge Agreement
1.106 Syndication Parties
1.107 Tangible Net Worth
1.108 10 Year Maturity Date
1.109 10 Year Revolving Loan
1.110 Total Liabilities
1.111 Xxxxxxx
1.112 Xxxxxxx Mortgage(s)
1.113 Xxxxxxx Security Documents
1.114 Xxxxxxx Subsidiaries
1.115 WLR
Article 2. 7 YEAR REVOLVING LOAN
2.1 7 Year Revolving Loan
2.1.1 Individual Syndication Party 7 Year Commitment
2.1.2 Individual Syndication Party 7 Year Pro Rata Share
2.2 Aggregate 7 Year Commitment; Available Amount; Merger.
2.3 7 Year Revolving Promissory Notes
2.4 Syndication Party Records
2.5 Use of Proceeds
2.6 Advances; Funding
2.7 Syndication Party Funding Failure
2.8 Reduction of Aggregate 7 Year Commitment
Article 3. 10 YEAR LOAN
3.1 10 Year Loan
3.1.1 Individual Syndication Party 10 Year Commitment
3.1.2 Individual Syndication Party 10 Year Pro Rata Share
3.2 Aggregate 10 Year Commitment; Available Amount; Merger
3.3 10 Year Loan Promissory Notes
3.4 Syndication Party Records
3.5 Use of Proceeds
3.6 Advances; Funding
3.7 Syndication Party Funding Failure
3.8 Reduction of Aggregate 10 Year Commitment
Article 4. INTEREST AND FEES
4.1 Interest
4.1.1 Base Rate Option
4.1.2 LIBO Rate Option
4.2 Additional Provisions for LIBO Rate Loans
4.2.1 Inapplicability or Unavailability of LIBO Rate
4.2.2 Change in Law; LIBO Rate Loan Unlawful
4.3 Default Interest Rate
4.4 Interest Calculation
4.5 Fees
4.5.1 Commitment Fee
4.6 Interest Rate Margins; Commitment Fee Factor
4.6.1 Calculation
4.6.2 Compliance Certificate
4.7 Maximum Interest Rate
Article 5. PAYMENTS; FUNDING LOSSES
5.1 Principal Payments
5.1.1 Converted Loans
5.1.2 Automatic Conversion
5.1.3 Principal Payment Schedule
5.2 Interest Payments
5.3 Voluntary Prepayments
5.4 Mandatory Prepayments
5.5 Application of Principal Payments
5.5.1 Scheduled Payments
5.5.2 Voluntary Prepayments
5.5.3 Mandatory Prepayments
5.6 Manner of Payment
5.7 Distribution of Principal and Interest Payments
5.7.1 Principal and Interest Payments on 7 Year Revolving Loan
5.7.2 Principal and Interest Payments on 10 Year Revolving Loan
5.8 Funding Losses
Article 6. BANK EQUITY INTERESTS
6.1 Purchase of Bank Equity Interests
Article 7. SECURITY
7.1 Borrower's Collateral
7.2 Guaranty
7.3 Guarantor's Collateral
Article 8. REPRESENTATIONS AND WARRANTIES
8.1 Organization, Good Standing, Etc
8.2 Corporate Authority, Due Authorization; Consents
8.3 Litigation
8.4 No Violations
8.5 Binding Agreement
8.6 Compliance with Laws
8.7 Principal Place of Business
8.8 Payment of Taxes
8.9 Licenses and Approvals
8.10 Employee Benefit Plans
8.10.1 Employee Benefit Plans; Multiemployer Plans
8.10.2 Pension Benefit Plans
8.10.3 Prohibited Transactions
8.10.4 Civil/Criminal Action
8.10.5 Funding
8.10.6 Compliance With Law
8.10.7 Multiple Employer Plan
8.10.8 Plan Termination Liability; Multiemployer Plan Withdrawal
Liability
8.10.9 Pension Plan Termination
8.10.10 Reportable Event
8.10.11 Payment of Contributions
8.10.12 Welfare Benefit Plans
8.11 Equity Investments
8.12 Title to Real and Personal Property
8.13 Financial Statements
8.14 Environmental Compliance
8.15 Fiscal Year
8.16 Material Agreements
8.17 Regulations U and X
8.18 Trademarks, Tradenames
8.19 No Default on Outstanding Judgments or Orders
8.20 No Default in Other Agreements
8.21 Labor Matters; Labor Agreements
8.22 Governmental Regulation
8.23 Confidential Information Memorandum
8.24 Financial Projections
8.25 Solvency
8.26 Survivor Stock; WLR Chicken and Turkey Assets; and Acquisition
Stock
8.27 Xxxxxxx Subsidiary Assets
8.28 Disclosure
Article 9. CONDITIONS TO ADVANCES
9.1 Conditions to Closing
9.1.1 Loan and Amendment Documents; Possession of Collateral; and
Pilgrim Guaranty
9.1.2 Approvals
9.1.3 Organizational Documents
9.1.4 Evidence of Insurance
9.1.5 Title Insurance; Survey
9.1.6 Appointment of Agent for Service - Borrower and Acquisition
Corp.
9.1.7 No Material Change
9.1.8 Fees and Expenses
9.1.9 Evidence of Corporate Action - Borrower and Acquisition
Corp.
9.1.10 Opinion of Counsel
9.1.11 Acquisition Guaranty
9.1.12 Acquisition Agreement
9.1.13 Material Agreements.
9.1.14 Further Assurances
9.2 Borrowing Notice; Funding Notice
9.3 Conditions to Advance
9.3.1 Default
9.3.2 Availability Period
9.3.3 Representations and Warranties; Fees and Expenses
9.3.4 No Material Change
9.4 Conditions to Advance to Funding Concerning Merger, or
Subsidiary Merger
9.4.1 Evidence of Insurance
9.4.2 Appointment of Agent for Service
9.4.3 Evidence of Corporate Action
9.4.4 Opinion of Counsel
9.4.5 Representations and Warranties
9.4.6 Merger Consideration
9.4.7 Compliance Certificate
9.4.8 Solvency Certificate and Pro Forma Financial Statements
9.4.9 Further Assurances
9.5 Special Provisions Relative to Merger and Subsidiary Merger
9.6 Limitation on LIBO Rate Loans
9.7 Illegality of Loan
9.8 Treatment of Affected Loans
Article 10. AFFIRMATIVE COVENANTS
10.1 Books and Records
10.2 Reports and Notices
10.2.1 Annual Financial Statements
10.2.2 Quarterly Financial Statements
10.2.3 Notice of Default
10.2.4 ERISA Reports
10.2.5 Notice of Litigation
10.2.6 Notice of Material Adverse Effect
10.2.7 Notice of Environmental Proceedings
10.2.8 Regulatory and Other Notices
10.2.9 Adverse Action Regarding Required Licenses
10.2.10 Notice of Certain Changes
10.2.11 Available Amount Reports
10.2.12 Appraisals
10.2.13 Filings and Reports
10.2.14 Additional Information
10.3 Grant of Liens on WLR Related Assets
10.3.1 Survivor Stock
10.3.2 Xxxxxxx Securities Collateral
10.3.3 WLR Chicken Assets
10.3.4 WLR Turkey Assets
10.4 Maintenance of Existence and Qualification
10.5 Compliance with Legal Requirements and Agreements
10.6 Compliance with Environmental Laws
10.7 Taxes
10.8 Insurance
10.9 Title to and Maintenance of Properties
10.10 Payment of Liabilities
10.11 Inspection
10.12 Required Licenses; Permits; Etc
10.13 ERISA
10.14 Financial Covenants
10.14.1 Leverage Ratio
10.14.2 Tangible Net Worth
10.14.3 Current Ratio
10.14.4 Net Tangible Assets to Total Liabilities
10.14.5 Fixed Charge Coverage Ratio
10.14.6 Net Working Capital
10.15 Appraised Property
10.16 Consummation of
10.17 Opinion of Counsel
10.18 Title Insurance Endorsements.
10.19 Agent for Service - Subsidiary Merger Survivor
10.20 Documents With Respect to Merger and Subsidiary Merger
10.21 Material Agreements
10.22 Exhibit Updates
Article 11. NEGATIVE COVENANTS
11.1 Borrowing
11.2 No Other Businesses
11.3 Liens
11.4 Sale of Assets
11.5 Liabilities of Others
11.6 Loans
11.7 Merger; Acquisitions; Business Form; Etc
11.8 Investments
11.9 Transactions With Related Parties
11.10 Dividends, etc
11.11 ERISA
11.12 Change in Fiscal Year
11.13 Leases
11.14 Principal Payments
Article 12. INDEMNIFICATION
12.1 General; Stamp Taxes; Intangibles Tax
12.2 Indemnification Relating to Hazardous Substances
Article 13. EVENTS OF DEFAULT; RIGHTS AND REMEDIES
13.1 Events of Default
13.2 No Advance
13.3 Rights and Remedies
13.4 Agreement Regarding, and Waiver of, Certain Rights
Article 14. AGENCY AGREEMENT
14.1 Funding of Syndication Interest
14.2 Syndication Parties' Obligations to Remit Funds
14.3 Syndication Party's Failure to Remit Funds
14.4 Agency Appointment
14.5 Power and Authority of the Administrative Agent
14.5.1 Advice
14.5.2 Documents; Intercreditor Agreement
14.5.3 Proceedings
14.5.4 Retain Professionals
14.5.5 Incidental Powers
14.6 Duties of the Administrative Agent
14.6.1 Possession of Documents
14.6.2 Distribute Payments
14.6.3 Loan Administration
14.6.4 Action Upon Default
14.6.5 Indemnification as Condition to Action
14.6.6 Forwarding of Information
14.7 Consent Required for Certain Actions.
14.7.1 Unanimous
14.7.2 Required Lenders
14.7.3 Increase in Individual Commitment Amounts
14.7.4 Action Without Vote
14.7.5 Vote of Participants
14.8 Distribution of Principal and Interest
14.9 Distribution of Certain Amounts
14.9.1 Funding Losses
14.9.2 Fees
14.10 Possession of Loan Documents.
14.11 Collateral Application
14.12 Amounts Required to be Returned
14.13 Reports and Information to Syndication Parties
14.14 Standard of Care
14.15 No Trust Relationship
14.16 Sharing of Costs and Expenses
14.17 Syndication Parties' Indemnification of the Administrative
Agent
14.18 Books and Records
14.19 Administrative Agent Fee
14.20 The Administrative Agent's Resignation or Removal
14.21 Representations and Warranties of All Parties
14.22 Representations and Warranties of CoBank
14.23 Syndication Parties' Independent Credit Analysis
14.24 No Joint Venture or Partnership
14.25 Purchase for Own Account; Restrictions on Transfer;
Participations
14.26 Certain Participants' Voting Rights
14.27 Method of Making Payments
14.28 Events of Syndication Default/Remedies
14.28.1 Syndication Party Default
14.28.2 Remedies
14.29 Withholding Taxes
14.30 Amendments Concerning Agency Function
14.31 Reallocation of Outstanding Advances
14.32 Further Assurances
Article 15. MISCELLANEOUS
15.1 Costs and Expenses
15.2 Service of Process and Consent to Jurisdiction
15.3 Jury Waiver
15.4 Notices
15.4.1 Borrower
15.4.2 Administrative Agent
15.4.3 FCSA
15.4.4 Syndication Parties
15.5 Liability of Administrative Agent
15.6 Successors and Assigns
15.7 Severability
15.8 Entire Agreement
15.9 Applicable Law
15.10 Captions
15.11 Complete Agreement; Amendments
15.12 Additional Costs of Maintaining Loan
15.13 Capital Requirements
15.14 Replacement Notes
15.15 Mutual Release
15.16 Liberal Construction
15.17 Counterparts
15.18 Confidentiality
15.19 Limitation of Liability
15.20 Affect of Amended and Restated Credit Agreement